Family Wealth and the Class Ceiling: The Propulsive Power of The Bank of Mum and Dad

Maren Toft,Sam Friedman

doi:10.1177/0038038520922537

Abstract

In this article we demonstrate that those from working-class backgrounds face a powerful ‘class ceiling’ in elite occupations. Examining how class origin shapes economic returns in the Norwegian upper class (3.8% of the population), we first find that the income advantage enjoyed by those from privileged backgrounds increases sharply as they ascend the income distribution in both elite business and cultural fields. Second, we show that those from economically upper-class backgrounds enjoy the highest pay advantage in all upper-class destinations. Finally, we demonstrate the profound propulsive power provided by parental wealth. Our results indicate that this is the most important single driver of the class-origin income gap in virtually every area of the Norwegian upper class. These findings move forward an emerging literature on class-origin pay gaps beyond mean estimates to reveal the distinct ‘pay-off’ to class privilege in the very highest income-earning positions.

Highlights

Rising inequality since the 1980s – at the very top of the income distribution – has prompted a strong renewal of interest in elites across the social sciences (Savage, 2014)
Our findings demonstrate the value of this latter innovation. For example, that it is those from economic upper-class backgrounds that tend to enjoy the highest income advantage over colleagues from working-class backgrounds, in all segments of the dominant class
Our results suggest that parental wealth is often an important driver of class-origin earnings gaps. Among those working in elite cultural occupations, parental wealth is the most significant mechanism explaining why the children of the economic upper class enjoy higher earnings than their upwardly mobile colleagues

Summary

Introduction

Rising inequality since the 1980s – at the very top of the income distribution – has prompted a strong renewal of interest in elites across the social sciences (Savage, 2014). Among those working in elite cultural occupations, parental wealth is the most significant mechanism explaining why the children of the economic upper class enjoy higher earnings than their upwardly mobile colleagues.

Results

Conclusion