Estimating intergenerational income mobility on sub-optimal data: a machine learning approach

Francesco Bloise, Paolo Brunori () and Patrizio Piraino
Additional contact information
Paolo Brunori: University of Florence

No 526, Working Papers from ECINEQ, Society for the Study of Economic Inequality

Abstract: Much of the global evidence on intergenerational income mobility is based on sub-optimal data. In particular, two-stage techniques are widely used to impute parental incomes for analyses of developing countries and for estimating long-run trends across multiple generations and historical periods. We propose a machine learning method that may improve the reliability and comparability of such estimates. Our approach minimizes the out-of-sample prediction error in the parental income imputation, which provides an objective criterion for choosing across different specifications of the first-stage equation. We apply the method to data from the United States and South Africa to show that under common conditions it can limit the bias generally associated to mobility estimates based on imputed parental income.

Keywords: Intergenerational elasticity; income; mobility; elastic net; regularization; PSID, South Africa.. (search for similar items in EconPapers)
JEL-codes: C18 D63 J62 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2020-03
New Economics Papers: this item is included in nep-big and nep-cmp
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.ecineq.org/milano/WP/ECINEQ2020-526.pdf (application/pdf)

Related works:
Journal Article: Estimating intergenerational income mobility on sub-optimal data: a machine learning approach (2021)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:inq:inqwps:ecineq2020-526

Access Statistics for this paper

More papers in Working Papers from ECINEQ, Society for the Study of Economic Inequality Contact information at EDIRC.
Bibliographic data for series maintained by Maria Ana Lugo ( this e-mail address is bad, please contact ).