Financial wealth and early income mobility

Milan van den Heuvel, Jan Ryckebusch (), Koen Schoors and Tarik Roukny ()
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Jan Ryckebusch: Ghent University
Tarik Roukny: KU Leuven

Palgrave Communications, 2022, vol. 9, issue 1, 1-10

Abstract: Abstract We study the interaction between financial wealth and early income growth. Using banking data on career starters in Belgium, we find higher income growth for individuals with higher financial wealth as early as 3 years into a career. While the roles of social capital and innate abilities appear limited, our results suggest that individuals with higher disposable wealth are more likely to find a job matching their human capital, in turn, boosting their chances of higher performance and consequent income growth. Policies addressing individuals’ capacity to accommodate frictions in the market for first jobs could therefore substantially promote economic mobility.

Date: 2022
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DOI: 10.1057/s41599-022-01064-0

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