Intergenerational Mobility using Income, Consumption, and Wealth
64th ISI World Statistics Congress - Ottawa, Canada
Format: IPS Abstract
Keywords: consumption, income, mobility
Session: IPS 422 - Measuring Inequality in Income, Consumption and Wealth
Monday 17 July 2 p.m. - 3:40 p.m. (Canada/Eastern)
We use fifty years of the Panel Study of Income Dynamics to study the intergenerational correlation in income, consumption, and wealth for the same individuals to answer the question: is intergenerational mobility similar across the three resource measures? Absolute mobility is highest for consumption, followed by income and wealth. Income exhibits the highest intergenerational correlation, or lowest relative mobility, followed closely by consumption. Wealth exhibits much lower relative mobility. We also look at differences in relative mobility by race, sex, race and sex, parental education, and parental wealth. Black offspring and female offspring display lower upward mobility from the bottom and more downward mobility from the top for all three resource measures. Black female offspring experience both the race gap and the sex gap. High parental wealth compensates for low parental income or consumption, leading to more upward mobility from the bottom of the distribution. High parental wealth complements high parental income or consumption, leading to less downward mobility from the top.