Intergenerational Wealth Elasticity in Japan

Kubota, Keiichi

doi:10.1111/jere.12142

Cited by 6 publications

(7 citation statements)

References 29 publications

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“…More recently, Pfeffer and Killewald (2018) estimate the rankrank correlation in the US to 0.39 (a rank-rank correlation is the percentile rank difference in child wealth followed by a percentile change in parents' wealth, and this does adjust for differences in variances). Kubota (2017) estimates the intergenerational elasticity in Japan in the range of .26 to .37, but also finds the intergenerational transmission of wealth persists more strongly in the tails of the distributions, among the poorest and the wealthiest. Boserup, Kopczuk and Kreiner (2013) use register data from Denmark and estimate rank correlations of 0.27.…”

Section: Empirical Evidence On Direct Transmissionmentioning

confidence: 99%

The intergenerational transmission of wealth

Hällsten

2024

Preprint

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This chapter explores the significance of wealth as a key element of social stratification in contemporary societies. They are characterized by substantial inequality where a small portion of the population holds a disproportionate share of total wealth. The origin of wealth is primarily attributed to intergenerational transfers or personal savings over one's lifetime, yet the degree to which each contributes to overall wealth remains a subject of scholarly debate. Studies indicate significant intergenerational wealth persistence, particularly among the affluent, suggesting that being born into wealth strongly predicts adult affluence. This perpetuation of wealth across generations is likely driven by dynastic aspirations among the wealthiest, who view inherited wealth as a lineage asset. However, there is also notable mobility into elite circles through self-made wealth. The impact of inheritances on wealth inequality is complex, potentially reducing disparities by reducing recipients' workforce participation but also fostering greater investment acumen. Wealth additionally exerts indirect effects on educational, occupational, and marital outcomes, with more wealth generally correlating with better life outcomes in these areas. The study underscores the need for robust wealth data to comprehensively analyze these dynamics and their repercussions on broader societal equality and opportunity.

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Section: Empirical Evidence On Direct Transmissionmentioning

confidence: 99%

The intergenerational transmission of wealth

Hällsten

2024

Preprint

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“…Another problem with the JSPS is that parents' income is observed when fathers are almost 60 years old, which may induce life-cycle bias (Section 3). 10 In addition, Kubota (2017) applied the Parent and Child Survey, which observes filial wealth and parental wealth, and found that intergenerational wealth elasticity between parents and children (girls and boys pooled together) aged around 36.5 years in 2004 and 2006 lies around 0.35 using 2SLS.…”

Section: Intergenerational Income Elasticity For Firstborn and Later-...mentioning

confidence: 99%

Birth order and intergenerational income mobility in Japan: Is the first‐born child different?

Jia

2023

Asian Economic Journal

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This study examines how birth order affects intergenerational income mobility (IGM) in Japan, focusing on the difference in IGM between firstborn and later‐born children. The elasticities of sons’ income with respect to fathers’ income are separately estimated for sons who are firstborn and sons who are later born by family size using a two‐sample, two‐stage least squares approach. For sons born in 1926–1981, this study finds that in families with four or more children, intergenerational income elasticity (IGE) for firstborn sons is substantially and significantly higher than that for later‐born sons. However, no significant birth order effects are found in households with two or three children.

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“…4 The general conclusion from this literature is that income measured over several years around midlife is a good proxy for permanent income. Such measures yield approximately unbiased estimates of permanent income mobility (Grawe, 2006;Haider & Solon, 2006;Nybom & Stuhler, 2016;2017). if direct transfers (inter vivos and bequests) are quantitatively important; or if parental transfers contribute to home purchase, rather than to human capital or other assets that generate cash income.…”

Section: Introductionmentioning

confidence: 99%

“…Charles and Hurst (2003) is the best‐known early work to directly estimate intergenerational wealth mobility, for the United States. Other notable examples include Adermon et al (2018), who use Swedish data to study multigenerational wealth correlations and the central role of inheritances; Arrondel (2013) who study intergenerational correlations of wealth alongside risk and discounting preferences; Clark and Cummins (2015), who study long‐run intergenerational wealth persistence in England, linking administrative data sets using rare surnames; Kubota (2017), who estimate intergenerational wealth persistence in Japan, exploring the roles of income, educational level, bequests and preferences; and Pfeffer and Killewald (2018), who study multigenerational wealth persistence in the United States. Becker and Tomes (1986) and Charles and Hurst (2003) both cite earlier empirical work on wealth mobility, which mostly draws on small and unrepresentative samples.…”

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

The Correlation of Wealth Between Parents and Children in Australia

Siminski¹,

2022

Australian Economic Review

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Any opinions expressed in this paper are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but IZA takes no institutional policy positions. The IZA research network is committed to the IZA Guiding Principles of Research Integrity. The IZA Institute of Labor Economics is an independent economic research institute that conducts research in labor economics and offers evidence-based policy advice on labor market issues. Supported by the Deutsche Post Foundation, IZA runs the world's largest network of economists, whose research aims to provide answers to the global labor market challenges of our time. Our key objective is to build bridges between academic research, policymakers and society. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author.

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Intergenerational Wealth Elasticity in Japan

Cited by 6 publications

References 29 publications

The intergenerational transmission of wealth

The intergenerational transmission of wealth

Birth order and intergenerational income mobility in Japan: Is the first‐born child different?

The Correlation of Wealth Between Parents and Children in Australia

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