Like (Grand)Parent, Like Child? Multigenerational Mobility Across the EU

Abstract

This study shows that the intergenerational transmission of inequality in most of the 28 EU countries is higher than what a parent-to-child paradigm would suggest. While a strand of the literature claims that this is due to a direct grandparental effect, economic historian Gregory Clark maintains that multigenerational mobility follows a Markovian process. In his view, previous estimates of social status persistence are not only (severely) attenuated by an errors-in-variables problem, but are also constant across time and space. Using a survey covering all 28 EU countries, we provide evidence against such a universal law of mobility.We show that, while in most EU countries traditional estimates of social status persistence are indeed downward biased, there are sizable differences across countries driven by country-specific factors. Further, for a few EU countries we cannot reject the hypothesis of a direct grandparental effect after accounting for a number of parents related covariates possibly affecting the multigenerational transmission process.