The Impact of an Early Career Shock on Intergenerational Mobility

Kaila MarttiNix EmilyRiukula Krista

Abstract

Children’s and parent’s incomes are highly correlated, yet little is known about how early career shocks contribute to this correlation. This paper focuses on a consequential labor market shock: job loss. We document three new results. First, adult children born into the bottom 20% of the income distribution have double the unemployment following job loss compared with those from the top 20%, and 154% higher earnings losses. Second, this increases the rank-rank correlation 30% for those impacted. Third, richer parents provide career opportunities to their adult children after job loss, consistent with advantages from wealthy parents persisting well into adulthood.

Journal of Labour Economics.

Julkaisun tietoja

Päiväys
08.04.2024
Julkaisija / sarja
Journal of Labour Economics
Sivuja
73
Kieli
Englanti
Julkaisu ladattavissa
doi.org