The role of education in enhancing intergenerational income mobility

Joann Wilkie
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Joann Wilkie: Treasury, Government of Australia

Economic Roundup, 2007, issue 4, 81-100

Abstract: How income is transmitted from generation to generation is important to understanding the distributional impacts of policy. Compared with other OECD countries, labour income in Australia is relatively mobile across generations and Australia also has a moderate level of inequality, based on current household disposable income. OECD countries, with the exception of Canada, have either high inequality and low mobility or low inequality and high mobility. Education is an important factor influencing the extent to which income is transmitted from parent to child. The relatively high standard of minimum education outcomes in Australia and Canada, as reflected in the OECD’s Programme for International Student Assessment scores, are likely to play an important role in explaining Australia and Canada’s experience. Education outcomes alone, however, do not fully explain this combination of relatively high intergenerational income mobility and moderate income inequality.

Keywords: education; educational investment; income levels; economic mobility; skills (search for similar items in EconPapers)
JEL-codes: H52 H75 I21 I24 (search for similar items in EconPapers)
Date: 2007
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