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Two‐sample nonparametric estimation of intergenerational income mobility in the United States and Sweden
Author(s) -
Murtazashvili Irina,
Liu Di,
Prokhorov Artem
Publication year - 2015
Publication title -
canadian journal of economics/revue canadienne d'économique
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.773
H-Index - 69
eISSN - 1540-5982
pISSN - 0008-4085
DOI - 10.1111/caje.12178
Subject(s) - earnings , social mobility , estimator , nonparametric statistics , economics , sample (material) , estimation , econometrics , demographic economics , population , economic mobility , labour economics , poverty , economic growth , sociology , statistics , demography , mathematics , social science , management , chemistry , accounting , chromatography
We estimate intergenerational income mobility in the US and Sweden, using a new nonparametric approach. The approach addresses several empirical issues raised in the literature and applies when other estimators are infeasible. We argue that previous estimates of income mobility conceal the heterogeneous nature of the transmission mechanism by keeping mobility constant across families. The striking differences we find between mobility patterns across family backgrounds, captured by father's education, lead us to question the conventional result that intergenerational transmission of earnings is weaker in Sweden than in the United States, for important parts of the population.