Hostname: page-component-cd9895bd7-8ctnn Total loading time: 0 Render date: 2024-12-26T04:42:02.560Z Has data issue: false hasContentIssue false
  • English
  • Français

Are we born equal: a study of intergenerational income mobility in China

Published online by Cambridge University Press:  11 March 2019

Mengjie Jin ,
Xuemei Bai ,
Kevin X Li  and
Wenming Shi
Mengjie Jin
Affiliation:
Jiangsu Key Laboratory of Modern Logistics, School of Marketing and Logistics Management, Nanjing University of Finance and Economics, Nanjing, Jiangsu, China
Xuemei Bai
Affiliation:
School of Statistics, Dongbei University of Finance and Economics, Dalian, China
Kevin X Li
Affiliation:
Ocean College, Zhejiang University, Zhoushan, China
Wenming Shi*
Affiliation:
Maritime and Logistics Management, Australian Maritime College, University of Tasmania, Office F96, Swanson Building, Maritime and Logistics Management, Australian Maritime College, Launceston, Tasmania, Australia
*
*Corresponding author. E-mail: [email protected]
Get access

Abstract

Studies show that the gain from China's remarkable growth of the past 35 years has not been evenly shared, especially through the intergenerational transmission of income. To address this concern, we use data from China Health and Nutrition Survey and find the intergenerational income elasticity to be 0.466 in 2011, which suggests that sons’ incomes are affected by their fathers’ economic statuses to a large extent. A cross-country comparison indicates that the degree of generational income mobility in China is lower than that in many developed nations. Meanwhile, by investigating possible transmission channels, we find that the fathers’ investments in the sons’ education and occupation play substantial roles in intergenerational transmission of income. The results not only demonstrate the trends in intergenerational income mobility in China, but also identify the most likely transmission channels, which is of great importance to improving social equality.

Keywords

Intergenerational income mobilitypersistent transitory fluctuationssocial equalitytransmission mechanisms

JEL classification

D63: Equity, Justice, Inequality, and Other Normative Criteria and Measurement D10: General D31: Personal Income, Wealth, and Their Distributions
Type
Research Papers
Information
Journal of Demographic Economics , Volume 85 , Issue 1 , March 2019 , pp. 1 - 19
Copyright
Copyright © Université catholique de Louvain 2019 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Atkinson, Anthony. B. (1980). On intergenerational income mobility in Britain. Journal of Post Keynesian Economics 3(2), 194–218.Google Scholar
Atkinson, Anthony Barnes, Trinder, Chris G., and Maynard, Alan K. (1978). Evidence on intergenerational income mobility in Britain. Economics Letters 1(4), 383–388.Google Scholar
Becker, Gary. S. and Tomes, Nigel (1979). An equilibrium theory of the distribution of income and intergenerational mobility. Journal of Political Economy 87, 1153–1189.Google Scholar
Behrman, Jere and Taubman, Paul (1985). Intergenerational earnings mobility in the United States: some estimates and a test of Becker's intergenerational endowments model. The Review of Economics and Statistics 67(1), 144–151.Google Scholar
Bhattacharya, Debopam and Mazumder, Bhashkar (2011). A nonparametric analysis of black–white differences in intergenerational income mobility in the United States. Quantitative Economics 2(3), 335–379.Google Scholar
Björklund, Anders, Roine, Jesper, and Waldenström, Daniel (2012). Intergenerational top income mobility in Sweden: capitalist dynasties in the land of equal opportunity? Journal of Public Economics 96(5–6), 474–484.Google Scholar
Björklund, Anders and Chadwick, Laura (2003). Intergenerational income mobility in permanent and separated families. Economic Letters 80, 239–246.Google Scholar
Björklund, Anders and Jäntti, Markus (1997). Intergenerational income mobility in Sweden compared to the United States. American Economic Review 87, 1009–1018.Google Scholar
Blanden, Jo, Gregg, Paul, and Macmillan, Lindsey. (2007). Accounting for intergenerational income persistence: noncognitive skills, ability and education. The Economic Journal 117(519), C43–C60.Google Scholar
Blanden, Jo, Haveman, Robert, Smeeding, Timothy and Wilson, Kathryn (2014). Intergenerational mobility in the United States and Great Britain: a comparative study of parent–child pathways. Review of Income and Wealth 60(3), 425–449.Google Scholar
Bratberg, Espen, Anti Nilsen, Øivind, and Vaage, Kjell (2005). Intergenerational earnings mobility in Norway: levels and trends. The Scandinavian Journal of Economics 107(3), 419–435.Google Scholar
Cardak, Buly A., Johnston, David W., and Martin, Vance L. (2013). Intergenerational earnings mobility: a new decomposition of investment and endowment effects. Labour Economics, 24, 39–47.Google Scholar
Cervini-Plá, María (2015). Intergenerational earnings and income mobility in Spain. Review of Income and Wealth 61(4), 812–828.Google Scholar
Chadwick, Laura and Solon, Gary (2002). Intergenerational income mobility among daughters. American Economic Review 92(1), 335–344.Google Scholar
Chen, Yi and Cowell, Frank A. (2017). Mobility in China. Review of Income and Wealth, 63(2), 203–218.Google Scholar
Cheng, Yuan and Jianzhong, Dai (1995). Intergenerational mobility in modern China. European Sociological Review 11, 17–35.Google Scholar
Chetty, Raj, Hendren, Nathaniel, Kline, Patrick, and Saez, Emmanuel. (2014). Where is the land of opportunity? The geography of intergenerational mobility in the United States. The Quarterly Journal of Economics 129(4), 1553–1623.Google Scholar
Corak, Miles (2013). Income inequality, equality of opportunity, and intergenerational mobility. Journal of Economic Perspectives 27(3), 79–102.Google Scholar
Corak, Miles and Heisz, Andrew (1999). The intergenerational income mobility of Canadian men: evidence from longitudinal tax data. Journal of Human Resources 34, 504–533.Google Scholar
Dearden, Lorraine, Machin, Stephen, and Reed, Howard (1997). Intergenerational mobility in Britain. Economic Journal 107, 47–64.Google Scholar
Deng, Quheng, Gustafsson, Björn and Shi, Li (2013). Intergenerational income persistence in urban China. Reviewof Income and Wealth 59(3), 416–426.Google Scholar
Ding, Ning and Yougui, Wang (2008). Household income mobility in China and its decomposition. China Economic Review 19, 373–380.Google Scholar
Emran, Shahe and Yan, Sun (2015). Magical transition? Intergenerational educational and occupational mobility in rural China: 1988–2002. World Bank Policy Research Working Paper No. 7316. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2621870Google Scholar
Erikson, Robert and Goldthorpe, John H. (2002). Intergenerational inequality: a sociological perspective. Journal of Economic Perspectives 16(3), 31–44.Google Scholar
Ermisch, John, Francesconi, Marco and Siedler, Thomas (2006). Intergenerational mobility and marital sorting. Economic Journal 116, 659–679.Google Scholar
Fan, Yi, Junjian, Yi, and Junsen, Zhang (2015). The Great Gatsby Curve in China: Cross-Sectional Inequality and Intergenerational Mobility. Working Paper, CUHK, Hong Kong.Google Scholar
Fortin, Nicole M. and Lefebvre, Sophie (1998). Intergenerational income mobility in Canada. In Corak, Miles (ed.), Labour Markets, Social Institutions, and the Future of Canada's Children, pp. 51–64. Ottawa: Statistics Canada, Catalogue No. 89-553-XPB.Google Scholar
Galindo-Rueda, Fernando and Vignoles, Anna (2005). The declining relative importance of ability in predicting educational attainment. Journal of Human Resources XL(2), 335–353.Google Scholar
Golley, Jane and Tao Kong, Sherry (2013). Inequality in intergenerational mobility of education in China. China & World Economy 21(2), 15–37.Google Scholar
Gong, Honge, Leigh, Andrew and Xin, Meng (2012). Intergenerational income mobility in urban China. Review of Income and Wealth 58, 481–503.Google Scholar
Gregg, Paul and Tominey, Emma (2005). The wage scar from male youth unemployment. Labour Economics 12(4), 487–509.Google Scholar
Guo, Congbin and Weifang, Min (2008). Education and intergenerational income mobility in urban China. Front of Education China 3(1), 22–44.Google Scholar
Heckman, James J., Stixrud, Jora, and Urzua, Sergio (2006). The Effects of Cognitive and Noncognitive Abilities on Labor Market Outcomes and Social Behavior. NBER Working Paper No. 12006.Google Scholar
Ichino, Andrea, Karabarbounis, Loukas and Moretti, Enrico (2011). The political economy of intergenerational income mobility. Economic Inquiry 49(1), 47–69.Google Scholar
Labar, Kelly (2007). “Intergenerational mobility in China”, Document de travail de la série Etudes et Documents, E 2007.29, CERDI.Google Scholar
Lam, David and Schoeni, Robert F. (1994). Family ties and labor markets in the United States and Brazil. Journal of Human Resources 29(4), 1235–1258.Google Scholar
Lee, Chul-In and Solon, Gary (2009). Trends in intergenerational income mobility. Review of Economics and Statistics 91(4), 766–772.Google Scholar
Lefranc, Arnaud and Trannoy, Alain (2005). Intergenerational earnings mobility in France: is France more mobile than the US? Annalesd'Economieet de Statistique 78, 57–77.Google Scholar
Leigh, Andrew (2007). Intergenerational mobility in Australia. Berkeley Electronic Journal of Economic Analysis and Policy 7(2), Article 6.Google Scholar
Lindahl, Lena (2008). Do birth order and family size matter for intergenerational income mobility? Evidence from Sweden. Applied Economics 40(17), 2239–2257.Google Scholar
Liu, Yong (2010). Transport infrastructure investment, regional economic growth and the spatial spillover effects: based on highway and marine's panel data analysis. China Industrial Economics 12, 37–46.Google Scholar
Mansur, Kasim, Kogid, Mori, and Jessica Madais, Sylvia (2010). Human capital investment: literature review analysis and a study case among Kadazan-Dusun of Pulutan Village, Menggatal, Kota Kinabalu, Sabah, Malaysia. The Social Sciences 5(3), 264–269.Google Scholar
Mazumder, Bhashkar (2005). Fortunate sons: new estimates of intergenerational mobility in the United States using social security earnings data. Review of Economics and Statistics 87, 235–255.Google Scholar
Mocetti, Sauro (2007). Intergenerational earnings mobility in Italy. B.E. Journal of Economic Analysis &Policy 7(Contributions), Article 5.Google Scholar
Ng, Irene Y. H. (2013). The political economy of intergenerational income mobility in Singapore. International Journal of Social Welfare 22(2), 207–218.Google Scholar
Nicoletti, Cheti and Ermisch, John F. (2007). Intergenerational earnings mobility: changes across cohorts in Britain. Berkeley Electronic Journal of Economic Analysis & Policy 7(2), Article 9.Google Scholar
Nilsen, Øivind Anti, Vaage, Kjell, Artvik, Arild and Jacobsen, Karl (2008). Estimates of Intergenerational Elasticities Based on Lifetime Earnings. Institute for the Study of Labor (IZA), Discussion Paper No. 3709.Google Scholar
Österberg, Torun (2000). Intergenerational income mobility in Sweden: what do tax-data show. Reviewof Income and Wealth 46(4), 421–436.Google Scholar
Pascual, Marta (2009). Intergenerational income mobility: the transmission of socio-economic status in Spain. Journal of Policy Modeling 31, 835–846.Google Scholar
Pekkala, Sari and Lucas, Robert E. B. (2007). Differences across cohorts in Finnish intergenerational income mobility. Industrial Relations: A Journal of Economy and Society 46(1), 81–111.Google Scholar
Pekkarinen, Tuomas, Uusitalo, Roope and Kerr, Sari (2009). School tracking and intergenerational income mobility: evidence from the Finnish comprehensive school reform. Journal of Public Economics 93, 965–973.Google Scholar
Peters, H. Elizabeth (1992). Patterns of intergenerational mobility in income and earnings. Review of Economics and Statistics 74(3), 456–466.Google Scholar
Pirano, Patrizio (2007). Comparable estimates of intergenerational income mobility in Italy. Berkeley Electronic Journal of Economic Analysis & Policy 7(2), Article 1.Google Scholar
Qin, Xuezheng, Tianyu, Wang, and Chen Zhuang, Castiel (2016). Intergenerational transfer of human capital and its impact on income mobility: evidence from China. China Economic Review 38, 306–321.Google Scholar
Shi, Wenming, Bang, Hee-Seok, and Li, Kevin X. (2016). A cross-region analysis of the output elasticity of transport investment in China. Maritime Policy & Management 43(2), 222–241.Google Scholar
Solon, Gary (1989). Biases in the estimation of intergenerational earnings correlations. The Review of Economics and Statistics 71, 172–174.Google Scholar
Solon, Gary (1992). Intergenerational income mobility in the United States. American Economic Review 82, 293–408.Google Scholar
Solon, Gary (2002). Cross-country differences in intergenerational earnings mobility. Journal of Economic Perspectives 16(3), 59–66.Google Scholar
Stevens, Ann Huff (1997). Persistent effects of job displacement: the importance of multiple job losses. Journal of Labor Economics 15(1), 165–188.Google Scholar
Takenoshita, Hirohisa (2007). Intergenerational mobility in East Asian countries: a comparative study of Japan, Korea and China. International Journal of Japanese Sociology 16, 64–79.Google Scholar
The Economist (2016). Rising rural incomes are making China more equal. HANGBU, [online] http://www.economist.com/news/finance-and-economics/21698674-rising-rural-incomes-are-making-china-more-equal-up-farm (assessed May 14 2016).Google Scholar
Wang, Haigang (2005). The household income mobility and its equalizing long term income in China (in Chinese). Economic Research Journal 1, 56–66.Google Scholar
Yang, Mayfair Mei-hui (1994). Gifts, Favors, and Banquets: The Art of Social Relationships in China. Ithaca: Cornell University Press.Google Scholar
Yang, Juan and Muyuan, Qiu (2016). The impact of education on income inequality and intergenerational mobility. China Economic Review 37, 110–125.Google Scholar
Yuan, Zhigang and Lin, Chen (2013). The trend and mechanism of intergenerational income mobility in China: an analysis from the perspective of human capital, social capital and wealth. The World Economy 36(7), 880–898.Google Scholar
Zimmerman, David J. (1992). Regression toward mediocrity in economic stature. American Economic Review 82, 409–429.Google Scholar