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Rich Dad, Smart Dad: Decomposing the Intergenerational Transmission of Income
Stockholm University, Faculty of Social Sciences, The Swedish Institute for Social Research (SOFI).
2012 (English)In: Journal of Political Economy, ISSN 0022-3808, E-ISSN 1537-534X, Vol. 120, no 2, p. 268-303Article in journal (Refereed) Published
Abstract [en]

We construct a simple model, consistent with Becker and Tomes, that decomposes the intergenerational income elasticity into the causal effect of financial resources, the mechanistic transmission of human capital, and the role that human capital plays in the determination of fathers' permanent incomes. We show how a particular set of instrumental variables could separately identify the money and human capital transmission effects. Using data from a 35 percent sample of Swedish sons and their fathers, we show that only a minority of the intergenerational income elasticity can be plausibly attributed to the causal effect of fathers' financial resources.

Place, publisher, year, edition, pages
2012. Vol. 120, no 2, p. 268-303
National Category
Economics
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URN: urn:nbn:se:su:diva-77514DOI: 10.1086/666590ISI: 000305085900003OAI: oai:DiVA.org:su-77514DiVA, id: diva2:533450
Available from: 2012-06-13 Created: 2012-06-13 Last updated: 2022-02-24Bibliographically approved

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Lindquist, Matthew J.

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