The Decline in Intergenerational Mobility after 1980

Abstract

Abstract Relative intergenerational mobility declined for cohorts born around 1960 compared to those born around 1950. The former entered the labor market after the rise in inequality around 1980 while the latter entered the labor market earlier. We show that the rank-rank slope rose from 0.25 to 0.36 and the intergenerational elasticity increased from 0.28 to 0.45. These increases are more pronounced for men than for women. Increases in returns to schooling and in the gradient in the likelihood of marriage by parent income are contributors to increased intergenerational persistence.