Estimates of Intergenerational Elasticities Based on Lifetime Earnings

Øivind Nilsen, Kjell Vaage, Arild Aakvik and Karl Jacobsen ()
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Karl Jacobsen: Statistics Norway

No 3709, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Using Norwegian intergenerational data with a substantial part of the life-cycle earnings of children and almost the entire life-cycle earnings for their fathers, we present new estimates of intergenerational mobility. Extending the length of the fathers' earnings windows from 5 to 30 years increases the estimated elasticities. Increasing the age of father at observation has the opposite effect. Our findings indicate that intergenerational earnings mobility may have been strongly overstated in many earlier studies with shorter earnings histories. Biases in the estimated elasticities appear to be related to age and/or life-cycle measurement errors more than persistency in the transitory innovations.

Keywords: intergenerational mobility; measurement error (search for similar items in EconPapers)
JEL-codes: C23 J62 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2008-09
New Economics Papers: this item is included in nep-age and nep-lab
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Citations: View citations in EconPapers (15)

Published - published as 'Intergenerational Earnings Mobility Revisited: Estimates Based on Lifetime Earnings' in: Scandinavian Journal of Economics, 2012, 114 (1), 1 - 23

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