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American Economic Review Vol. 111 No. 5 2021

Dynastic Human Capital, Inequality, and Intergenerational Mobility

Adrian Adermon1; Mikael Lindahl2; Mårten Palme3

1 Institute for Evaluation of Labor Market and Education Policy (IFAU), UCFS and UCLS (email: ) · 2 Department of Economics, University of Gothenburg, CESifo, IFAU, IZA, and UCLS (email: ) · 3 Department of Economics, Stockholm University, CESifo, IFS, and IZA (email: )

open access

Abstract

We study the importance of the extended family – the dynasty – for the persistence in inequality across generations. We use data including the entire Swedish population, linking four generations. This data structure enables us to identify parents' siblings and cousins, their spouses, and the spouses' siblings. Using various human capital measures, we show that traditional parent-child estimates of intergenerational persistence miss almost one-third of the persistence found at the dynasty level. To assess the importance of genetic links, we use a sample of adoptees. We then find that the importance of the extended family relative to the parents increases.

DOI
10.1257/aer.20190553
Volume
111
Issue
5
Pages
1523-1548
Language
en
Sources
bibtex:phds-export.bib openalex crossref

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