Intergenerational earnings elasticity revisited: how does Australia fare in income mobility?

Huang, Yangtao, Perales, Francisco and Western, Mark (2015). Intergenerational earnings elasticity revisited: how does Australia fare in income mobility?. LCC Working Paper Series 2015-14, Institute for Social Science Research, The University of Queensland.

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Author Huang, Yangtao
Perales, Francisco
Western, Mark
Title Intergenerational earnings elasticity revisited: how does Australia fare in income mobility?
School, Department or Centre Institute for Social Science Research
Institution The University of Queensland
Open Access Status File (Publisher version)
Series LCC Working Paper Series
Report Number 2015-14
Publication date 2015-07-01
Total pages 25
Language eng
Formatted abstract
This paper contributes to the existing income mobility literature by adopting a two-stage panel regression model, investigating linear and curvilinear trends over time, and assessing the effects of using different levels of occupational disaggregation, different sample compositions, and different earnings measures on the magnitude of father-son earnings elasticity in Australia. We find that the overall intergenerational earnings elasticity in Australia between 2001 and 2013 ranges from 0.11 to 0.30, with evidence of an upward trend. Elasticity estimates are larger using two-digit level occupations and two-sample approach than the estimates using one-digit occupations and one-sample approach, respectively, and earnings volatility has substantial effects on elasticities. We read these findings as indicating that Australia has a moderately high level of income mobility by international standards, and that findings are sensitive to the use of methods and data.
Keyword Parental background
Intergenerational transmission
Earnings elasticity
Occupation
Trends
Panel data
Australia
Institutional Status UQ

 
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Created: Mon, 06 Jul 2015, 09:59:13 EST by Francisco Paco Perales on behalf of Institute for Social Science Research