Intergenerational Earnings Mobilities – How Sensitive are they to Income Measures?

Abstract

This article gives various estimates of intergenerational earnings mobility by applying different earning periods, age brackets, and earning components. The methodology enables us to investigate how sensitive results are to different delimitations and, thereby, to make more accurate international comparisons of intergenerational earnings mobility. We find that intergenerational earnings mobility is found to be substantially lower when hourly wage rates rather than annual earnings are used, whether the latter are inclusive or exclusive of public transfers. Moreover, when the same specifications are applied for Denmark as for other countries, we find that intergenerational earnings mobility from father to son in Denmark is on the same level as in Sweden, Norway, and Finland, whereas the intergenerational earnings mobility in all the Nordic countries is found to be higher than in the United Kingdom and the United States.