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Are we born equal: a study of intergenerational income mobility in China

Published online by Cambridge University Press:  11 March 2019

Mengjie Jin ,
Xuemei Bai ,
Kevin X Li  and
Wenming Shi
Mengjie Jin
Affiliation:
Jiangsu Key Laboratory of Modern Logistics, School of Marketing and Logistics Management, Nanjing University of Finance and Economics, Nanjing, Jiangsu, China
Xuemei Bai
Affiliation:
School of Statistics, Dongbei University of Finance and Economics, Dalian, China
Kevin X Li
Affiliation:
Ocean College, Zhejiang University, Zhoushan, China
Wenming Shi*
Affiliation:
Maritime and Logistics Management, Australian Maritime College, University of Tasmania, Office F96, Swanson Building, Maritime and Logistics Management, Australian Maritime College, Launceston, Tasmania, Australia
*
*Corresponding author. E-mail: Wenming.Shi@utas.edu.au
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Abstract

Studies show that the gain from China's remarkable growth of the past 35 years has not been evenly shared, especially through the intergenerational transmission of income. To address this concern, we use data from China Health and Nutrition Survey and find the intergenerational income elasticity to be 0.466 in 2011, which suggests that sons’ incomes are affected by their fathers’ economic statuses to a large extent. A cross-country comparison indicates that the degree of generational income mobility in China is lower than that in many developed nations. Meanwhile, by investigating possible transmission channels, we find that the fathers’ investments in the sons’ education and occupation play substantial roles in intergenerational transmission of income. The results not only demonstrate the trends in intergenerational income mobility in China, but also identify the most likely transmission channels, which is of great importance to improving social equality.

Keywords

Intergenerational income mobilitypersistent transitory fluctuationssocial equalitytransmission mechanisms

JEL classification

D63: Equity, Justice, Inequality, and Other Normative Criteria and Measurement D10: General D31: Personal Income, Wealth, and Their Distributions
Type
Research Papers
Information
Journal of Demographic Economics , Volume 85 , Issue 1 , March 2019 , pp. 1 - 19
Copyright
Copyright © Université catholique de Louvain 2019 

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