Panel Data Estimation of the Intergenerational Correlation of Incomes

Ramses H. Abul Naga and Jaya KRISHNAKUMAR

Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP) from Université de Lausanne, Faculté des HEC, DEEP

Abstract: We consider the problem of estimating the intergenerational correlation of incomes in the context of a panel data framework with measurement errors. We present single equation estimation methods as well as system methods under various assumptions regarding the serial correlation of the error term and taking into account possible correlations among children of the same family. Application to a sample of US parents and children leads to estimates of the order of 0.42 to 0.60 for the coefficient of income transmission.

Keywords: intergenerational mobility; panel data; errors in variables (search for similar items in EconPapers)
JEL-codes: I3 J6 C3 (search for similar items in EconPapers)
Date: 1999-07
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Published in Panel Data : Future Research Directions, Essays in Honour of Professor Pietro Balestra, Krishnakumar, J. and Ronchetti, E. (eds), Elsevier, Amsterdam, 2000

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Persistent link: http://EconPapers.repec.org/RePEc:lau:crdeep:9910

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