A Test of the Becker-Tomes Model of Human Capital Transmission Using Microdata on Four Generations

Mikael Lindahl, Mårten Palme, Sofia Sandgren-Massih and Anna Sjögren

Journal of Human Capital, 2014, vol. 8, issue 1, 80 - 96

Abstract: We estimate the well-known Becker-Tomes model of intergenerational transmission of human capital. A Swedish data set, which links individual measures on educational attainments of four generations, enables us to use great-grandparents' education as an instrumental variable. The identifying assumption, which holds within the Becker-Tomes framework, is that great-grandparents' education is unrelated to great-grandchildren's education, conditional on the education of the parent and grandparent. We test the model's prediction that the structural parameter for grandparents' education enters with a negative sign in an intergenerational regression model.

Date: 2014
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Working Paper: A test of the Becker-Tomes model of human capital transmission using microdata on four generations (2013)
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