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Correlations of Brothers' Earnings and Intergenerational Transmission

Paul Bingley () and Lorenzo Cappellari
Additional contact information
Paul Bingley: VIVE - The Danish Centre for Applied Social Science

No 10761, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Correlations between parent and child earnings reflect intergenerational mobility and, more broadly, correlations between siblings' earnings reflect shared community and family background. These earnings relationships capture important aspects of relations in socioeconomic status more generally. We estimate intergenerational transmission and sibling correlations of life-cycle earnings jointly within a unified framework that nests previous models. Using data on the Danish population of father/first-son/second-son triads we find that intergenerational effects account for on average 72 percent of sibling correlations. This share is higher than all previous studies because we allow for heterogeneous intergenerational transmission between families. Sibling correlations exhibit a U-shape over the working life, consistent with differences in human capital investments between families.

Keywords: life-cycle earnings; intergenerational transmission; sibling correlations (search for similar items in EconPapers)
JEL-codes: D31 J62 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lab and nep-ltv
Date: 2017-05
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Citations: View citations in EconPapers (6) Track citations by RSS feed

Published in: Review of Economics and Statistics, 2019, 101 (2), 370 - 383

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Related works:
Journal Article: Correlation of Brothers' Earnings and Intergenerational Transmission (2019) Downloads
Working Paper: Correlations of Brothers' Earnings and Intergenerational Transmission (2017) Downloads
Working Paper: Correlation of Brothers Earnings and Intergenerational Transmission (2013) Downloads
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