Labor Supply Decisions, Occupational Segregation, and Intergenerational Income Mobility – Germany and the United States Compared

Abstract

The article directs attention to the structuring effects of humancapital variables and family-background characteristics on labor supply decisions, occupational segregation, and intergenerational income mobility in the United States and Germany - two countries with different institutional labor market settings and family role patterns. The article tests the hypothesis that the impact of family-background characteristics on labor supply decisions, sex or gender segregation, and intergenerational transmission of social and economic status is more expressed in societies with traditional role patterns. Using data from the international version of the Cross-National Equivalent File (PSIDGSOEP), the results of the static labor supply model show that gender and education significantly determine the individual labor market participation in both the countries. Occupational gender segregation is more pronounced in Germany than in the United States. The contribution of the occupational groups to total gender segregation differs by country but not by marital status. We find stronger evidence for the impact of individual- and family-background characteristics on the intergenerational heritage of social status in the United States than in Germany.