A Comparison of Intergenerational Mobility Curves in Germany, Norway, Sweden, and the US

Abstract

We use two non-parametric measures to characterize intergenerational mobility (IGM) throughout the income distribution: Rank Mobility and Income Share Mobility. We examine differences in these IGM curves between Germany, Norway, Sweden and the United States using comparable samples. Although we find that these curves are approximately linear through most of the income distribution, non-linearities are important in describing crosscountry differences. The linear representations of these curves lead to different conclusions regarding crosscountry differences depending on the measure. Using ranks, we find that the U.S. is substantially less intergenerationally mobile than the three European countries which have fairly similar degrees of rank mobility. Despite the substantial heterogeneity in intergenerational rank mobility within the U.S., we show that the most mobile region of the U.S. is still less mobile than the least mobile regions of Norway and Sweden. When we use a linear estimator of Income Share Mobility we find that the four countries have very similar rates of IGM. However, there are some notable crosscountry differences at the bottom and the top of the income distribution for both types of mobility. For example, the U.S. tends to experience lower upward mobility at the very bottom of the income distribution according to both measures. We conclude that researchers should be careful in drawing conclusions regarding crosscountry differences in intergenerational mobility given that the results may be sensitive to the concept being used and to non-linearities. *We thank participants at the Human Capital and Economic Opportunity workshop on social mobility for many helpful comments. The views expressed here do not reflect those of the Federal Reserve Bank of Chicago or the Federal Reserve system.

Estimating the Intergenerational Elasticity and Rank Association in the U.S.: Overcoming the Current Limitations of Tax Data

“…This is also important because it is this concern about robustness of the IGE with their particular sample that is a primary reason that Chetty et al turn to rank-based estimators. 3 This can be contrasted with several other studies (Bhattacharya and Mazumder, 2011;Corak et al, 2014;Mazumder, 2014;Davis and Mazumder, 2015;and Bratberg et al, 2015), that have also used rank-based measures to study intergenerational mobility but for conceptual reasons.…”

Et egalitært og velferdsstatlig integreringsparadoks?

“…I tillegg til at økonomiske forskjeller i utgangspunktet er mindre i egalitaere land, overføres altså mindre av denne ulikheten til neste generasjon. Den oppadstigende mobiliteten nederst i inntektsfordelingen blant barn som vokser opp i hjem med dårlig familieøkonomi, er saerlig høy i Norge og andre de skandinaviske velferdsstatene (Bratberg et al, 2016;Bratsberg et al, 2007). Egalitaere velferdsstater reduserer altså ikke bare omfanget av barnefattigdom (Gornick og Jäntti, 2012)…”

Biases in Standard Measures of Intergenerational Income Dependence

“…Rank-based measures are the basis for much of the recent evidence on mobility differentials across countries (Corak et al, 2014;Bratberg et al, 2015), time (Chetty et al, 2014b;Pekkarinen et al, 2015), and regions within countries (Chetty et al, 2014a In this paper we provide evidence on approximation biases across all four dependence measures. Our empirical analysis takes advantage of unusually long administrative series of income data from Sweden.…”