PUBLIC EDUCATION EXPENDITURES, HUMAN CAPITAL INVESTMENT AND INTERGENERATIONAL MOBILITY: A TWO-STAGE EDUCATION MODEL

We show in this paper that, depending on the initial distribution of material wealth and that of individuals' abilities, economies converge in the long run towards different proportions of the skilled workforce and different levels of average wealth. We also show that the growth process raises net economic mobility, the long-run proportion of the skilled population and the long-run levels of wealth held by both rich and poor dynasties. Unless the income tax rate is too high, the increase in total public funds is associated, in the long run, with higher net mobility, a larger fraction of the skilled workers and higher levels of wealth of all the dynasties. In addition, the reallocation of public expenditures from basic to advanced education can result in lower mobility, a lower long-run size of the skilled workforce, and a lower long-run level of wealth held by rich dynasties, if the transfer of resources comes at the expense of excessively lowering the quality of education at the basic schooling level.     

A NOTE ON INTERGENERATIONAL MOBILITY AND INTRAHOUSEHOLD BALANCE OF POWER

This paper studies how family's decisions about investments in children are an important determinant of adults' earnings, and thus of persistence in income differentials. We propose a model of investment in children that allows parents to have different preferences using a collective household framework, and investigate how the intrahousehold distribution of power affects children outcomes and the transmission of economic status across generations. The results suggest that failure to account for intrahousehold balance of power as source of household heterogeneity might affect the interpretation of the structural parameters of interest and the evaluation of earnings persistence.     

INTERGENERATIONAL INCOME MOBILITY IN URBAN CHINA

This paper estimates the intergenerational income elasticity for urban China, paying careful attention to the potential biases induced by income fluctuations and life cycle effects. Our preferred estimate indicates that the intergenerational income elasticity for father–son is 0.63. This suggests that while China has experienced rapid growth of absolute incomes, the relative position of children in the distribution is largely related to their parents' incomes. By investigating possible causal channels, we find that parental education plays one of the most important roles in transmitting economic status from parents to children.     

DRUG POLICY AND INTERGENERATIONAL INCOME MOBILITY IN THE UNITED STATES

A conviction for drug possession blocks some of the most common pathways through which individuals from low income families achieve upward economic mobility in the United States, such as access to higher education, entry‐level employment, and military service. These considerations are of growing importance because the number of drug‐related arrests have nearly quadrupled since 1980. This article estimates the effect of a conviction for drug possession on earnings mobility using a sample of individuals born between 1980 and 1984, some of the first cohorts to come of age in the context of intensive U.S. drug criminalization and enforcement. To distinguish the effect of a drug conviction from the effect of drug use or general criminality, I compare mobility among individuals with drug convictions to control groups who self‐report significant drug use and who have had interactions with the criminal justice system that did not lead to a drug conviction. I find that relative to these groups, a drug conviction reduces the probability of transitioning upward from various points in the lower half of the income distribution by 10–15 percentage points, or as much as 50%, and that these effects are substantially stronger for non‐whites than for whites. These findings suggest that a policy of decriminalizing nonviolent drug possession would substantially increase intergenerational mobility among low income populations, and this effect should be weighed alongside more conventional costs and benefits in formulating optimal drug policy. (JEL J38, J15, K42)     

CASH TRANSFERS,INTERGENERATIONAL MOBILITY,AND THE PROCESS OF DEVELOPMENT

We examine how cash transfers affect an individual's education investment, intergenerational mobility, and economic growth. We find that providing larger transfer amounts to higher ability children is desirable to foster growth if the economy has relatively low wage inequality.     

ETHNIC AND GENDER DIFFERENCES IN INTERGENERATIONAL MOBILITY: A STUDY OF 26-YEAR-OLDS IN THE USA

This paper uses the traditional income framework and a non‐monetary framework to estimate intergenerational mobility in economic status for a sample of 26‐year‐old whites, blacks and Hispanics in the USA using data from the first and fifth sweeps of the National Educational Longitudinal Study (1988 and 2000). Intergenerational income mobility is found to be greater for males than for females, although there are differences between whites, blacks and Hispanics. Transition probabilities indicate that Hispanics are the most upwardly mobile in terms of educational attainment and occupational status. Ordered logits are used to estimate the impact of parental education and occupation on educational and occupational outcomes.     

INTERGENERATIONAL INCOME MOBILITY IN SWEDEN: WHAT DO TAX‐DATA SHOW?

The aim of this paper is to investigate intergenerational income mobility in Sweden by means of a representative sample drawn from tax-data files. Longitudinal data on actual parent-child pairs spanning 1978–92 are employed. Regression and correlation coefficients are analyzed and transition matrices calculated in order to investigate income mobility over generations. The results achieved show high intergenerational income mobility in Sweden between fathers and sons in comparison to estimations performed in most other countries and more especially compared to the U.S. This indicates that Sweden does not only have lower cross-sectional income inequality, but also higher intergenerational income mobility than those countries. The mother's earnings influence children's earnings less than the father's. However, the mother's earnings correlate more strongly with a daughter's earnings than they do with that of a son. The major indication of immobility across generations is found in the upper income deciles.     

DIFFERENCES IN PORTUGUESE CREDIT INSTITUTIONS' LENDING AND INVESTMENT BEHAVIOUR IN A TIME OF SLUMP

The purpose of this paper is to investigate the influence of the different property rights models of credit institutions (public, private, cooperative or mutual) in their credit policy and investment behaviour and in response to the current crisis and regulatory framework adjustments. Taking Portuguese credit institutions as the object, it concludes that overall banks’ business models are qualitatively identical and their lending and investment behaviours are similar, except for the saver profile of cooperative banks and the deeper focus on loans to customers to the detriment of financial investments of the mutual savings banks. Moreover, the reactions to the crisis were equivalent, except for the state‐owned banks, which presented the most favourable reaction, albeit not deep enough to be significant.     

TOUGH LOVE AND INTERGENERATIONAL ALTRUISM*

This article develops and studies a tough love model of intergenerational altruism. We model tough love by modifying the Barro‐Becker standard altruism model in two ways. First, the child’s discount factor is endogenously determined, so lower childhood consumption leads to a higher discount factor later in life. Second, the parent evaluates the child’s lifetime utility with a constant high discount factor. Our model predicts that parental transfers will fall when the child’s discount factor falls. This is in contrast with the standard altruism model, which predicts that parental transfers are independent of exogenous changes in the child’s discount factor.     

SOCIAL INSURANCE AND OCCUPATIONAL MOBILITY

This article studies how insurance from progressive taxation improves the matching of workers to occupations. We propose an equilibrium dynamic assignment model to illustrate how social insurance encourages mobility. Workers experiment to find their best occupational fit in a process filled with uncertainty. Risk aversion and limited earnings insurance induce workers to remain in unfitting occupations. We estimate the model using microdata from the United States and Germany. Higher earnings uncertainty explains the U.S. higher mobility rate. When workers in the United States enjoy Germany's higher progressivity, mobility rises. Output and welfare gains are large.     

INVENTORIES AND FIXED INVESTMENT

We model fixed investment incorporating the inventory decision of the firm. Using Dutch listed nonfinancial firms during 1985–2000, we find that the inventory stock is negatively associated with fixed investment. The results suggest that the inventory stock may be used by the firm as a buffer in response to unexpectedly high demand. In addition, the firm may hold the inventory stock as a contingency substitute for the financial source of fixed investment.     

UPWARD STRUCTURAL MOBILITY,EXCHANGE MOBILITY,AND SUBGROUP CONSISTENT MOBILITY MEASUREMENT: U.S.–GERMAN MOBILITY RANKINGS REVISITED

We formalize the concept of upward structural mobility and use the framework of subgroup consistent mobility measurement to derive a relative and an absolute measure of mobility that is increasing in upward structural mobility and compatible with the notion of exchange mobility. In our empirical illustration, we contribute substantively to the ongoing debate about mobility rankings between the U.S. and Germany by demonstrating that the U.S. typically does exhibit more upward structural mobility than Germany.     

经济转型中的投资行为与投资总量

针对我国投资和投资所有制结构的特殊现象,该文结合现代投资理论和经济转型的制度背景,建立了我国国有和非国有经济的投资行为模型.我们得出了投资方程的解析解并规范地解释非国有经济"投资不足"、国有经济"投资饥渴"、投资与产量双重萎缩以及低效投资等特殊宏观现象.该文的研究还有助于评价既往改革推进进程,理解我国国有经济的亏损现象,并对国有经济改革的产权导向观点提供了部分支持.     

CHILD POVERTY, INVESTMENT IN CHILDREN AND GENERATIONAL MOBILITY: THE SHORT AND LONG TERM WELLBEING OF CHILDREN IN URBAN CHINA AFTER THE ONE CHILD POLICY

China's One Child Policy (OCP), introduced in 1979, changed fundamentally the nature of both existing and anticipated marriage arrangements and influenced family formation decisions in many dimensions, especially with respect to the number of and investment in children. The policy coincided with the Economic Reforms of 1979 and the trend toward greater urbanization, all of which may have influenced the wellbeing of children. This paper examines the mobility status consequence of children in urban China since the introduction of the OCP and the economic reforms using data drawn from urban household surveys in China. The analysis first makes the comparison between child poverty in Canada, the United Kingdom and urban India, where it was found that both status and trends of child poverty are very different among the countries, with children not being over-represented in the poverty group in urban China. The extent to which the policies influenced investment in children is next examined by studying the way in which the relationship between the educational attainment of children and family characteristics changed within families formed prior to and after 1979. We found that the impact of household income and parental educational attainment increased significantly over time, with a positive gender effect where girls advanced more than boys. Applying new techniques for measuring mobility, we observe the reduction in intergenerational mobility. This phenomenon is found to be particularly prevalent in the lower income quantiles, reinforcing a dynastic notion of poverty.