Intergenerational Mobility Trends and the Changing Role of Female Labor

TL;DR

This paper analyzes intergenerational income mobility in Scandinavia and the US, revealing increasing correlations especially for women, driven by female income's role in reflecting productivity and employment access.

Contribution

It demonstrates that rising intergenerational income correlations are linked to women’s improved labor market participation and income reflecting productivity, not increased transmission of human capital.

Findings

Intergenerational income correlations increased across Scandinavia and the US.

Mother-daughter correlations rose, while father-son remained stable.

Income mobility decline is due to female income better capturing productivity.

Abstract

Using harmonized administrative data from Scandinavia, we find that intergenerational rank associations in income have increased uniformly across Sweden, Denmark, and Norway for cohorts born between 1951 and 1979. By gender, father-son mobility remains stable, while correlations for mothers and daughters rise. Similar patterns appear in US survey data, albeit with different timing. We show that the decline in income mobility reflects female income more accurately capturing underlying productivity, rather than stronger intergenerational transmission of human capital or changes in assortative mating. Finally, we show parent-child correlations increase mainly when women gain access to jobs that match their productivity.