Verteilung- 04 Social Mobility

Intergenerationale Einkommenselastizität (IGE)

measure of relative mobility

can be interpreted based on Becker and Tomes Model

Great Gatsby Curve as key narrative

Cross-country negative correlation between (more) inequality and intergenerational mobility

Simplified Becker and Tomes Model- Economic Mechanism

Parents invest into the human capital of their children → policies matter

Simplified Becker and Tomes Model- Mechanical Transmission

Other cultural and genetic endowments are transmitted from parents and children → policies can do little to affect transmission of genes and not much to impact transmission of norms, etc. within families

Simplified Becker and Tomes Model- key descriptive parameter

intergenerational elasticity

intergenerational elasticity

slope coefficient in a regression of log child income on log parent income

Simplified Becker and Tomes Model- Key Prediction

Social mobility will be high as all parents can invest the same amount in their children, and mechanical transmission is low

Einkommenselastitzität

Wir wollen messen wie die Ressourcen, die Eltern zu Verfügung haben, Einfluss auf das Einkommen des Kindes hat

IGE - Mobility

relative

IGE- Limitations

Father-Son earning
log(income) bei Frauen 0 = mathematisch unmöglich

IGE - Problems

• limited sense of absolute differences

• no sense of directional change

• no possibility of non-linearities

Absolute Mobilität

Wohlstand erhöht sich für alle

kein Einfluss auf Position innerhalb

Relative Mobilität

Veränderung der Positionen zu einander

Jemand muss absteigen, damit ein anderer aufsteigen kann