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Social class and income intergenerational mobility

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... will be Talking More about Social Mobility David Cameron Today Programme, ... anti-social ... It is from within social class variation in income ... – PowerPoint PPT presentation

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Title: Social class and income intergenerational mobility


1
Centre for Market and Public Organisation
Intergenerational Mobility The Next
Generation Based on work by Jo Blanden, Paul
Gregg and Lindsey Macmillan, Longview Seminar
29th June 2007.
2
Introduction Background
  • Most people are willing to accept wide
    inequalities if they are coupled with equality of
    opportunities The Economist (Oct 2006)
  • This year I will be Talking More about Social
    Mobility David Cameron Today Programme, Radio 4
    (Jan 2007)

3
Introduction Background
  • Intergenerational
  • Income Mobility
  • How closely related are incomes of parents and
    children?
  • Social Mobility
  • How closely related is the Social class of
    parents and children?
  • Also other outcomes

4
Introduction Background
  • Literature was mostly concerned with measurement,
    i.e. the strength of the correlation between
    income across generations.
  • More recently comparisons across countries and
    across time have begun to emerge
  • 2 substantive findings In terms of Income based
    mobility
  • UK relatively immobile (along with US)
  • Mobility in UK has declined between 1958 and 1970
    birth cohorts

5
Methodology
Intergenerational Income Mobility

6
Introduction Background
  • Recent and On-going CMPO/CEE Research
  • 1. Drivers of Mobility
  • 2. Comparing Drivers of Mobility across cohorts
  • 3. Projecting Mobility for Current generations

7
Plan of the Talk
  • Consider the routes through which income persists
    for the 1970 (BCS) cohort. The objective is to
    understand the drivers of persistence.
  • Analysis is restricted to sons at this stage.
  • Make comparisons between the 1958 (NCDS) and 1970
    cohorts in an attempt to understand why
    intergenerational transmissions have
    strengthened.
  • Extend analysis to earlier and later cohorts for
    within data restrictions

8
Drivers of Mobility Modelling approach
9
Data British Cohort Study (1)
  • Parental income data available at ages 10 and 16,
    average these.
  • Sons earnings at age 33.
  • Cognitive tests at age 5 and 10.
  • Mother reports on behaviour age 5.
  • Teacher reports on behaviour and self-reported
    measures at age 10.
  • Detailed education information including exam
    results.
  • Work history records from age 30 enable the
    construction of number of months unemployed and
    out of labour force.

10
Data British Cohort Study (2)
  • Cognitive tests
  • Age 5 copying and english picture vocab test
  • Age 10 reading, maths, British ability scale
  • Non-cognitive measures
  • Mum, age 5 neurotic, anti-social
  • Teacher, age 10 application, clumsiness,
    extroversion, hyper-activity, anxious.
  • Child, age 10 locus of control, self-confidence.
  • Child, age 16 malaise.
  • All cognitive and non-cognitive measures are
    normalised to mean 0, standard deviation 1.

11
Family income relationships - 1970
12
Earnings Equations at age 30
13
(No Transcript)
14
Data Cross cohort comparison
  • Income is only available at age 16 in NCDS.
    Earnings are from age 33.
  • Cognitive tests for reading, maths and general
    ability at 11, similar to BCS.
  • Non-cognitive tests are different between the
    cohorts, use Bristol social adjustment scales for
    NCDS.
  • unforthcoming, withdrawn, depressed, anxious for
    acceptance adults, hostile to adults, writing
    off adults, anxious for acceptance kids,
    hostility to kids, restless, inconsequential
    behaviour, misc.
  • For both cohorts mother reports generate two
    measures from rutter scales at age 10,
    internalising and externalising.
  • Concerns about attrition and non-response in both
    cohorts, no evidence that this is responsible for
    cross-cohort differences.

15
The change in intergenerational mobility
16
(No Transcript)
17
Policy implications
  • Fall in mobility was explained by growing
    relationship between family income and
    non-cognitive skills, education and early
    unemployment.
  • Not due to IQ or cognitive skills.
  • 3 possible policy routes
  • Close gap in non-cognitive skills (especially
    personal efficacy and concentration).
  • Educational performance at age 16 and beyond.
  • Help in early career (policies to avoid NEET).

18
Conclusions
  • Overall nearly 90 of the increase in
    intergenerational income is explained using the
    first approach
  • 20 of this rise is accounted for by the
    increasing correlation between income and O
    levels
  • 35 through post-16 education (A-levels, degree
    etc)
  • 30 through early LM attachment youth
    unemployment/NEETs
  • None came through innate cognitive ability being
    more related to family background and ability
    became less important in predicting education
    attainment
  • It is from within social class variation in
    income that the increase in persistence has
    occurred

19
2. Extending the Story
  • Intergenerational Mobility has an ageing
    problem, to observe the full cycle takes at least
    30 years.
  • But we can observe the childhood drivers of
    mobility evolving much quicker Family income
    relationship with test scores, education etc.
  • And can observe returns of the most recent cohort
    available this can provide a prediction of
    mobility for the generation of children.
  • Also the earlier 1946 cohort offers further
    insight into past intergenerational patterns

20
Four Cohorts
  • Two Parts
  • Family Income and educational attainment at age
    18 (58,70,75-80, 81-86 - BHPS) or at 21 (58,70,
    75-80)
  • Family Income and Test scores (58,70,91/2)

21
Observable data for first stage analysis
  • 1958 1970 1975-86 1991/2
  • Family income v v v v
  • Parental Education v v v
    v
  • Childs Education v v v
  • Cognitive scores v v v
  • (at age 10/11)
  • Self-esteem v v
  • Locus of Control v v
  • Application v v v
  • Adult Earnings v v

22
Relationship between family income and Childs
Education
23
(No Transcript)
24
Returns to education NCDS, BCS and BHPS old
25
Summary
  • Family Background and test scores show very
    similar patterns over time (46-70)
  • Relationship between Family Income and
    Educational qualifications strengthened and then
    receded
  • Returns to qualifications very stable 1991 to 2002

26
Some Assumptions
  • Assume returns remain the same for next cohort
  • Assume residual earnings and family income have
    similar relationship

27
Run on to Later BHPS Cohort
28
And Finally - ALSPAC
29
Conclusions 1
  • Cross cohort comparisons are difficult for data
    comparability reasons
  • Relationships between family background and
    cognitive test scores (age 10) are very stable
  • Educational attainment appears to have became
    more socially graded but this maybe easing

30
Conclusions 2
  • Making some assumptions about returns to
    education and the extent to which residual
    earnings are related to family background we can
    project future mobility patterns
  • This suggests that for children born in early
    1980s (and left school around 2000), mobility had
    return to the pictures observed for the 1958
    children
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