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Labour Economics 7 2000 785–796 www.elsevier.nlrlocatereconbase
Replication study
Reapplication and extension: intergenerational mobility in the United States
Alison Aughinbaugh
Bureau of Labor Statistics, Room 4945, Postal Square Building, 2 Massachusetts AÕe. NE, Washington, DC 20212, USA
Received 1 February 2000; accepted 7 September 2000
Abstract
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This paper replicates and extends Solon’s Am. Econ. Rev. 82 1992 393–408. article AIntergenerational Income Mobility in the United States B. The results confirm previous
findings about the degree of transmission in earnings and consumption from fathers to sons. The correlation between fathers’ and sons’ earnings lies in the neighborhood of 0.4 and the
correlation in consumption is larger. Using the sons’ outcomes when they are 5 years older does not alter the estimates of the correlation in earnings, but the estimates of the
correlation in consumption are smaller and closer to the estimates of the correlation in earnings. The estimates that use consumption data are sensitive to whether sons’ 1984 or
1989 outcomes are used and to whether one adjusts for family size and structure. q 2000 Elsevier Science B.V. All rights reserved.
JEL classification: J1 Keywords: Transmission; Status; Intergenerational; Father; Son
1. Introduction
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In the June 1992 issue of the American Economic ReÕiew, Solon 1992 presents new estimates of the intergenerational correlation in income for the US.
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The estimates he reports, as well as those Zimmerman 1992 reports in the same issue of the ReÕiew, are in the neighborhood of 0.4. Their work points toward less
Tel.: q1-202-691-7520; fax: q1-202-691-7425. Ž
. E-mail address: aughinbaugh abls.gov A. Aughinbaugh .
– 0927-5371r00r - see front matter q 2000 Elsevier Science B.V. All rights reserved.
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PII: S 0 9 2 7 - 5 3 7 1 0 0 0 0 0 2 4 - 5
mobility in status across generations than was suggested by earlier work.
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Recent studies have found both greater and less mobility than that estimated by Solon or
Zimmerman.
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After attempting to replicate Solon’s results for earnings, I consider how the relative youthfulness of the sons in Solon’s sample affects the results by
estimating the intergenerational correlations later in the sons’ lives and by looking at different measures of status for fathers and sons.
First, I compare the estimates when earnings are used to proxy for status, and sons’ earnings from 5 years later are used in the estimation. Second, I examine the
effects of using data on consumption as opposed to earnings to measure economic status.
Using data on sons from 5 years later produces estimates of the correlation in earnings that are about 0.4. In contrast, the results using consumption data point to
greater transmission of status than do those using earnings data. The consumption results that use later data are smaller and more similar to the results that use
earnings than the consumption results that use the earlier data, particularly when family size is accounted for. As a whole, the results indicate that consumption is
transmitted to children to a greater extent than are earnings. This is feasible if saving behavior is transmitted or if transfers which make the consumption patterns
of the two generations more similar are passed between parents and children.
2. Results using earnings
