Department of Economics and Related Studies

Abstract
Despite the publication of several recent reviews surveying evidence as to the
nature, extent and causal mechanics of the intergenerational transmission of
economic status (Corak 2006; Black & Devereux 2011), such is the rate of flux in this
active research field that even the most contemporary contributions (Jntti &
Jenkins 2013) now require important revision. Further, no author to date has
critically assessed the completeness of this body of research as it pertains to the
United Kingdom (UK). This essay seeks to provide an up-to-date review of extant
research concerning intergenerational mobility in the UK, which is broadly
structured along the evolution of the literature. I find that while recent empirical
contributions have provided us with somewhat more reliable estimates as to the
extent of prevailing intergenerational dependence, such analyses lose much of their
significance once we consider recent findings from more active research regions
(principally the US and Nordic countries), which have moved beyond simple
population level analyses over a single generation. In the final part, I present an
agenda for future research based on the gaps in evidence highlighted from
throughout this review. Additionally, I propose a feasible investigation to
ameliorate several of these blind spots which is inspired by the work of Atkinson et
al. (1983) and centered around the city of York.

Acknowledgments
I would like to thank Dr. Anindya Bhattacharya for his kind support and many
helpful comments.

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Contents

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INTRODUCTION
Intergenerational mobility (hereafter IGM) is concerned with the socio-economic
status of parents and the socioeconomic outcomes of their children as adults
(Blanden 2013). For economists, this is typically measured by family income,
individual earnings or more recently wealth (Hills et al., 2013; Karagiannaki, 2012).
Following the foundational work of Atkinson, Maynard and Trinder (Atkinson et al.,
1983) in the city of York, researchers in the UK began to measure both the extent to
which measures of economic status are correlated with ones parents, and the rate
at which (dis)advantage decays or perpetuates from generation to generation.
Recent multinational IGM reviews have focussed on the forces that drive the
intergenerational relationship (Black & Devereux, 2011), and on the descriptive
devices available to researchers (Jantti & Jenkins, 2013). Yet despite almost two
decades of empirical research, no paper has so far provided a critical overview of
these findings with respect to the UK; a requirement so as point toward new
avenues of enquiry and to assess the reliability of results.
This review is broadly structured along the evolution of the literature. Part (1)
provides a detailed critique of studies employing what is by far the most common
tool used to quantify how economic status is transmitted: intergenerational
elasticity (IGE). As IGE offers only a summary measure as to the effect of a marginal
increase in parental income/earnings at the geometric mean of the response
variable over a single generational transmission, Part (2) surveys the nascent UK
literature that expands upon this classic form of mobility measurement. Finally, in
Part (3) I outline an agenda for future research based on the evidence gaps
identified from across these correspondent literatures.

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PART (1) CLASSIC MOBILITY MEASURMENT

The benchmark empirical relationship considered throughout the IGM literature

relates the log of parental lifetime economic status (1

) to the log of their

childrens lifetime economic status ( ) through OLS using the simple

intergenerational elasticity (IGE) regression equation:

) +
ln( ) = + ln(1

(1)

For a cross-section of familial pairs indexed by i, Eq. (1) refers to the fraction of
inequality

among

parents

economic

statuses

(typically

proxied

by

incomes/earnings) that is on average observed among adult children in generation

t. Due to the complexity of the historic trends in womens labour market attachment,
most of the literature focusses on parent(s)/son pairs (Corak 2013), and will do
here unless specified. The constant term in this regression-to-the-mean model
captures the average change in economic status common across all children in that
generation, while the error term captures all influences in permanent income not
correlated with parental earnings, for example luck (see Mulligan (1997) for an
early theoretical discussion). The slope coefficient thus expresses the elasticity of
parent and child earnings; that is the intergenerational persistence of economic
status. For example, if = 0.5 and the incomes of two groups of parents differ by
100%, then the children of richer families will (on average) maintain an income
advantage of 50% above the children of the relatively poorer families. In theory
could take on any value. Incomes regress away from the mean when > 1.
When = 1, the persistence of parental relative inequality is perfectly replicated in
generation t, while = 0 implies perfect mobility. Predictably, every estimate we
do have of for the UK from various data sources suggests 0 < < 1, implying that
child outcomes are not perfectly correlated with parental earnings. Hence, (1 )
captures the extent of mobility.
As noted by Corak (2006), small differences in have important implications for
conferred advantages within countries. US data produced by Harding et al. (2003)
has shown how with a measured elasticity of 0.6, children of parents in the top
decile of incomes earn on average 4.4 times as much as the children of low income
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parents, while an elasticity of 0.4 implies that this average advantage is reduced to
2.7 times the amount in generation t. This underscores the sensitivity of our
inferences with respect to nominally small differences between alternative
measures of . Having introduced the IGE concept, I will now proceed with a
sequential analysis of the UK literature. Table 1 (column 4) reports the headline
results from this exercise concerning estimated values of elasticity from simple
regressions that proxy for lifetime earnings as shown in Eq. (2):
ln( ) = + ln(1 ) +

(2)

A cursory glance reveals enormous disparities in previously measured values,

ranging from 0.026 (near perfect mobility) to 0.504 (high persistence). By
reviewing each authors methods and data use, my aim is to clarify with relative
precision why such differences emerge, and whether any single figure reported
(assuming constant linear elasticity for now) should be treated as a preferred
estimate.

(1)(a) Ermisch & Francesconi (2002)

The first paper of this analysis uses longitudinal data from the first nine waves of
the British Household Panel Survey (BHPS), 1991-1999. The BHPS is an annual
survey consisting of a nationally representative sample of 5,500 households
(approximately 10,000 people) recruited in 1991 (ISER n.d.). The authors Matched
Sample links sons aged 16 or above to one or both of their parents in at least one of
the nine waves, giving a total sample of 421 father/son pairs. To study the
intergenerational relationship, the authors run several regressions for separate
specifications that measure IGE using monthly earnings, average earnings,1 gross
annual income, average annual income and four variables that instrument for
earnings.2 The authors argue that in so far as these are imperfect instruments with
respect to lifetime earnings which is likely given that each may be independently
correlated with the childs lifetime earnings the IV estimations will provide
This means that information on parental economic status is averaged over all the available
years so as to reduces the ratio of signal to noise and thus the extent of error-in-variables bias
following Zimmerman (1992).
2 These instruments are: years of parental education (IVED), the local unemployment rate (IVUN),
the family structure of the parent during their own childhoods (IVFAM) and the parents score on
the occupational Hope-Goldthorpe scale (IVHG) (see Stuchbury, 2013).
1

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upwardly biased estimates of the true . The regressions also control for a vector of
child characteristics including age (Vit), that is:
ln = + ln(1 ) + +

(3)

The authors do not report separate results for simple estimations as in Eq. (2), only
the multivariate estimations that condition on child characterises as in Eq. (3)
(denoted as in Table 1, column 5), which does hinder their comparability. The
results show very small levels of intergenerational persistence for the UK. The OLS
estimates for father/son earnings elasticity is 0.048, which increases slightly to
0.059 once parental earnings from each wave are averaged owing to reduced
errors-in-variables bias (see n1). Parallel estimates for annual income are even
smaller (0.026) and not statistically significant. With regard to the IV estimations,
the results are indeed much larger, ranging from 0.108 (IVHG) to 0.221 (IVFAM).
Nevertheless, even these top end estimates do not suggest a large degree of
intergenerational correlation, although the authors do conject that their results
could be driven by their young sample (max age 29 in generation t).

(1)(b) Blanden et al. (2002)

Using data from two birth cohort studies, these authors aim is to trace secular
trends in IGM. The first data source is the National Child Development Study
(NCDS); a survey of all children born over a weeklong period in 1958, with those
surveyed at birth followed up at ages 7, 11, 16, 23, 33 and 42. The final wave of the
sample contains a sample of 11,419 individuals. The second source is the British
Cohort Survey (BCS), which similarly surveyed all children born over a single week
in 1970, with follow ups having taken place at ages 5, 10, 16, 26 and 30 by the time
of the authors analysis. So as to compare children at comparable ages in their
lifecycles, earnings are observed at ages 33 (NCDS) and 30 (BCS). As in the previous
study, samples are restricted to those in employment at the time the data was
collected. So as to account for varying parental ages within cohorts, Eqs. (2) and (3)
are supplemented with controls for parental age ( ), giving:
ln( ) = + ln(1 ) + 1 + 2 2 +

(4)

ln( ) = + ln(1 ) + + 1 + 2 2 +

(5)

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Eq. (5) controls for a broader vector of controls ( ) which include ethnicity,
parental education, experiences of parental worklessness during childhood and
early test scores. The authors also report the sample correlation between
generations t and t-1:
(lnYchild, lnYparent) = x

SD1
SDlnYt

Following Grawe (2006), the advantage of this measure (presented in column 6 of

Table 1) is that intergenerational dependence will not be mechanically affected by
differences in inequality within each generations earnings. In the present case, the
authors hypothecate that dispersion in parental income will be larger given that this
generations earnings will not be measured at the same points in each others
lifecycles.
The results from Eq. (4) which use weekly earnings as their unit for show a
large increase in IGE between the cohort periods ( = 0.098 < = 0.219).
The intergenerational correlations repeat this pattern across cohorts and are in
both cases larger in magnitude, which follows from the discussion above. The
results for Eq. (4) show a similar pattern ( = 0.047 < = 0.162), although
the coefficients are smaller in size after background controls are introduced as
expected. In all cases, the results suggest substantially less mobility than the
equivalent OLS results from the BHPS data above. Finally, because parents report
their incomes in two waves of the BCS (when the child is aged 10 and 16) as opposed
to just once in the NCDS, the authors repeat Eq. (4) using a time averaged measure
of fathers income, which greatly increases the coefficient to 0.273. An important
omission from these authors analyses so far concerns any recognition of transience
in childrens earnings. In one of the most widely cited studies in the field, Haider and
Solon (2006) show that the classic errors-in-variables model la Freidman
= +
(where represents the childs lifetime income and is the measurement error
from a single point-in-time observation) does not take adequate enough account of
the lifecycle over generation t. If the extent to which current income deviates from
lifetime income follows a consistent pattern over time, whereby children of all
-8-

backgrounds start in a relatively homogenous income bracket and diverge as those

with higher lifetime trajectories pull away from those in lower paid work, then
analyses of IGE that observe children at different ages will yield systematically
different elasticity estimates, showing a downward bias in earlier years as in
Ermisch and Francesconi (2002) above. These authors suggest a preferable model
(hereafter the HS model) to be:
= +

(6)

where is a coefficient of the linear projection of a one period income observation

on lifetime earnings which will approach 1 as t t* (that is, the point where one
period income best approximates lifetime average income) and will overreach at
later periods. We might speculate then that if income has not fully diverged by age
30, the NCDS and BCS results will likely be biased downwards. Additionally, by using
just one years worth of child data for each cohort, the authors in this study are also
implicitly assuming that if = + , then:

(1
, ) = 0

(7)

This means that the correlation between a parents economic status is in no way
correlated with the one period measurement error in their childs status; an
assumption also followed by Haider and Solon.3 As we will see, this too is very likely
implausible.

(1)(c) Blanden (2005)

Building upon the previous co-authored study, Blanden (2005) seeks to compare
estimates from the BCS with males similarly born around 1970 in the US, Canada
and West Germany. The empirical approach builds upon the specification in Eq. (4),
that is:
2
ln( ) = + ln( 80,861 ) + 1 + 2 2 + 1 + 2
+

(8)

On p1311 of their analysis, Haider and Solon show that if = 1

+ , then following Eq.

(6), = 1 + ( + ).
3

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With terms now indexed by country j, controls have been added for childrens age
( ) and its quadratic. Here the author is attempting to alleviate the types of
concern voiced earlier regarding lifecycle variations in childrens earnings
attenuating . Citing Haider and Solon , we read (p4) that the author uses earnings
at around 30 in all country studies as a measure of so as to root out variation and
facilitate cross-country comparability. Finally, Eq. (8) adds the term ( 80,86 1 ),
which represents the average family income measured during 1980 and 1986.

Does this arrest the strong assumption that (1

, ) = 0? That the correlation

between fathers lifetime income and the measurement error in a childs income
equals zero neglects the intuitive notion that the long-run income trajectories of
children from different backgrounds may follow very different time trends,
however much the average distance from varies across age ranges as picked up
by the population parameter . As discussed by Nybom and Stuhler (2013), those
from wealthier households may exploit family recourses so as to pursue advanced
training, whereas the children from lower income families may be restricted to
much shorter periods of vocational training. Hence, the point at which these
children reach what may be seen as their average lifetime incomes will likely differ.
This group inequality implies that comparisons within countries are feasible only
in so far as there exists a mutual point t* where the difference between the estimated
current earnings of all social groups equals the difference between their respective
lifetime earnings as in Eq. (1). Hence, by arbitrarily choosing ages close to 30 as the
authors point of measurement, the sign of the bias in our measure of elasticity, (),
will likely be negative; this due to the combination of earnings being viewed too
early in childrens lifecycles and intra-age group variation.4 More formally, under
the basic HS model the probability limit of equals . Therefore, using current
income at t* where = 1 should consistently estimate . However, given within age
group variation, is likely to be biased even after adjustment. This residual bias

As alluded to above, this downward bias may be driven by the fact that at very young ages the
children of poorer parents may even have an income advantage, having worked for several more
years than their university educated counterparts, and thus enjoying the fruits of relative
seniority in their respective trades. Indeed, at early enough ages parental economic status and
child earnings could even be negatively correlated.
4

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can thus be represented as: b(t) = ( ). If we assume for simplicity that

childrens (left-hand side) lifecycle bias is the only error affecting our estimated
elasticity, then using the same notation as in Eq. (6) the estimated coefficient will
equal:
=

Corr ( 1 , )
Cov ( 1 , )
=

Var ( 1 )
1

hence,

b(t) =( ) = 0 iff ( = 0 | = 1)

(9)

The last equality (added by the present writer) implies that even if =1, may not
equal , and thus some degree of bias will remain in the HS model.
The results from Eq. (8) show IGE for the UK equalling 0.209. To see how this result
could be affected by the combined implications of the HS model and Eq. (9), consider
the empirical work of Nybom and Stuhler (2013). Using administrative data from
Statistics Sweden on lifetime tax assessment records that link parents and children,
these authors are able to compute benchmark estimates akin to Eq. (1) that can then
be compared to age specific estimates.5 Crucially, this data now enables them to
estimate Eq. (6) using true lifetime income on the right of the equation so as to
obtain sequential estimates for . Through adjusting each annual elasticity

measure by the average lifecycle bias, , we may see whether = 0 as in Eq.

(9). Their results first confirm that does rise throughout peoples working lives
(see Figure 1), equalling 1 at age 33 in Sweden. Next, annual estimates for (which

may be thought of as analogous to Blandens estimate) and are plotted against the

benchmark estimate from Eq. (1), shown in Figure 2. The unadjusted remains
low during all years prior to age 35 relative to the benchmark estimate of 2.7, while
the adjusted measure understates the true IGE at nearly all ages, confirming the
notion in Eq. (9) that heterogeneity within age groups is another factor leading to a

More precisely, the authors estimate ln( ) = + ln( 1 ) + sequentially for each
age t to obtain year group estimates for .
5

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downward bias in present IGE estimates. If income profiles in the UK follow a similar
pattern as in Sweden, IGE estimates at age 30 will be attenuated by 50%, implying
that Blandens most comparable estimate of IGE from Eq. (9) 0.281 would equal
0.422 if lifetime child incomes were used. When classical measurement error in
parental incomes is introduced using annual parental income estimates relative to
their lifetime benchmark, equals around 0.08; 240% of the Swedish benchmark
(see Figure 3) and implying an IGE for the UK of 0.674.6
Blanden also adjusts the measure of sample correlation used in the previous paper
so as to again condition on the ages of the respondents.7 The author again suggests
that the advantage of this measure over standard elasticity estimation is that it
adjusts for inequality. For instance, if (

SD1PAGE
SDlnYt CAGE

) > 1 then inequality adjustment

may lead to a rise in . Equally, if inequality rises quickly in generation to such a

degree that it counteracts the variance in parental earnings attributable to parents
SD

being observed at different stages in their lifecycles then ( SD1PAGE

) < 1 , which
CAGE
lnYt

will mean that falls with adjustment. The author states broadly (p18) that while
inequality did rise over the second generation, the parental lifecycle effect appears
to dominate across countries. Looking at their UK data however reveals that while
the partial correlation for the single measure of parental income does rise relative
to the estimated (0.267>0.209), the measure of average parental earnings falls
(0.271<0.281), suggesting that once a more stable measure of parental income is
introduced:
SD1PAGE

1>(

SDlnYt CAGE

)=

(,1)

0.271
0.281

= 0.964

Figures tracing the evolution of top incomes presented by Piketty and Saez (2006)
have suggested that over the period directly covered by the BCS, the share of total
national income going to the top 0.1% of earners rose from around 1% to 3% in
1998 (see Figure 4), which may partially explain the relative size of the denominator

This result is also supported by suggestive evidence from the US, where Mazumder (2005)
finds using social security data that short term averages of fathers earnings alone cause a
downward bias of 30% on IGE due to transitory fluctuations.
SD1PAGE
7 This partial correlation takes the form: ( lnYchild CAGE lnYparent PAGE ) = x
SD
CAGE
6

lnYt

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above. Yet the effect of this rise in inequality is ambiguous with respect to both OLS
and the partial correlation. Although the latter abstracts from changes in variance
of income between generations, both are still highly sensitive to outliers in the tails
of their distributions, particularly as compared to measures such as Spearman's
rank-correlation, which ultimately questions the usefulness of these simple
summary statistics. Furthermore, empirical work by Nybom and Stuhler (2015) has
highlighted how it is equally important that linear correlations address transitory
noise in offspring income. Under textbook classical measurement error, the size of
any bias in OLS estimation can be shown to equal,

1
2
+ 2
1

, which is simply the

signal-to-noise or reliability ratio (rr). Correlations however are attenuated by

classical errors in both parent and childs earnings, with only the former affecting
elasticity.8 This means that estimates under the presence of this left-sided error in
child incomes will tend to be lower than for OLS. Using the same Swedish
administrative dataset as in their earlier work, the authors once again compute
benchmark estimates akin to Eq. (1) for several different measures of IGM. Their
results with respect to and are presented below in Figure 5, with the varying
age specific estimates shown along the dashed line. Both overstate mobility at early
stages as before, with the linear correlation remaining attenuated throughout the
lifecycle. From the forgoing analysis, the likelihood of the simple UK figures
reported by Blanden accurately predicting intergenerational dependence using
these identification strategies and restricted datasets would appear slim.

(1)(d) Ermisch & Nicoletti (2008)

Departing from the methods employed thus far, these authors attempt looking
backwards through recollective information on respondents fathers recorded in
Under classical measurement error, where is the error term from a simple regression and u
is the measurement error in the independent variable as above, the size of the bias is typically
decomposed (using the same parameters involved in this analysis) in the following way: =
8

(1 , )
(1 )

1 + )
(1 + ,
(1 )

is equal to ( ,1
)=

(1
, )
),
(1
( )

2
2

+ 2

. Because the true lifetime income correlation

, we can see that any correlation that is measured with

error or not representative of lifetime income will equal (1,

= ( ,1
) 1 ,

where rr denotes reliability ratio as above for both dependant and independent variables,
leading to a greater attenuation of the estimates.

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the BHPS (waves 1-13 BHPS; 1991-2003) so as to generate a new data source for
the study of IGM using two-sample two-stage least squares estimation (TS2SLS).
Two separate samples are initially created. The first (main sample) takes all adult
men surveyed post 1991 and born 1950-1972 (the sons in this analysis) who report
labour earnings greater than zero in at least one wave when aged between 31 and
45. These men are linked to fathers born between 1918 and 1949. The only
information on the earlier generation comes from recall data reported by the sons
regarding their fathers age, education and occupation when the respondent was
aged 14. Immediately, this leads to concerns over data reliability. Recessions of the
late 70s and early 80s saw an estimated 3 million Britons without work by 1982
(approximately one in eight working adults); a rate which had been climbing since
the start of the previous decade under the government of Ted Heath (BBC 1972,
1982). This begs the question of whether BHPS respondents born around the 1960s
show any consistent recall bias in defining their fathers by their former occupations
prior to job losses; a possibility not discussed by the authors that must shade their
results.9
The second sample (supplemental sample) consists of all men surveyed by the
BHPS born between 1923 and 1946. In order to measure IGE through TS2SLS,
fathers earnings are estimated by considering those earnings observed in the first
wave of the supplemental sample only (1991). Given that ln(1 ) in the main

What this would actually mean for the result reported in Table 1 is ambiguous. If the sons of
those who were jobless in the 1970s and 1980s tend to outperform their fathers with respect
to the latters true (unknown and possibly zero) earnt incomes when aged 14, then the authors
estimations would understate the true extent of mobility (1 ) . Equally, if the approximated
parental earnings are in many cases greater or similar to those of their children, then downward
child performance relative to the approximated parental earnings estimates may overstate
mobility, (1 ) > (1 ), by understating the true intergenerational dependence of
incomes. Unfortunately, the authors do not report even the average earnings of their
supplemental sample as they do for sons, so it is hard to get any kind of feeling for which of these
possibilities (if any) could be driving the results. The latter point might be feasible if we consider
evidence concerning intergenerational continuities in employment that were broken by the
decline in industry over the period. In the city of York, Atkinson et al. (1983, p169) use
information gathered between 1975-1978 to show that among the citys leading industries such
as confectionaries, textiles and British Rail, entries along the diagonal of their occupational
intergenerational transition matrix show around double the frequency than what would be
expected from a purely random assignment (see Figure 6 below).
9

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sample is not observable, imputed log earnings are estimated using a vector of
instruments from the ancillary regression 91 = + 1 , with Z the
equivalent of the recorded parental information from the main sample, and 91
the true incomes reported in the supplementary sample. Eq (2) then becomes
ln = + ln() +
with the same coefficient found from the ancillary regression, and the
recollective parental information taken from sons. From this, the BHPS can be used
to estimate IGE for sons at later stages of their lives; a potential improvement on
Ermisch and Francesconi (2002) whose results now appear severely attenuated by
observing sons at early ages as discussed.
The authors estimate several variants of this model, with their most complete
specification including 22 child birth year dummies indexed by x, (xCYEARi), with
1950 used as the reference category. Further controls are added for sons age and
fathers age as in Eq. (8), along with dummies for whether a child is born in one of
three separate birth cohorts (COHORTic) and similarly whether a father is born in
one of three birth cohorts (COHORTif). The complete model (estimated using yearly
child earnings as the dependant variable) is:
ln = + ln() + 1 + 2 2 + 1 +
2 2 + 1 1 + 2 2 + 3 1 + 4 2 +

(10)

The reported is 0.277. The question we must now ask is, how far we can trust
these results? Eq. (10) is based on a simplified version of an extension to the HS
model presented by Lee and Solon (2009). Although the specification is useful in
testing trends in income mobility after controlling for differences in age across both
parent and child cohorts, it will still be subject to the same attenuation from the
within age group variation for both generations, as in Figure 3. Nybom and Stuhler
(2013, p16) show using the same methodology as above that while IV estimates
( ) that instrument for 1 are typically conceived as providing an upper bound
estimate of a true coefficient, measurement error from lifecycle effects in childs age
is substantially larger than under OLS (see Figure 7). Elasticity estimates of vary
from -0.6 when measured at age 25 to 0.53 at age 45. As can be seen from the graph,
- 15 -

the larger error in the IV estimates relative to OLS the latter of which was still

attenuated even after adjustment through suggests that age controls in Ermisch

and Nicoletti's version of the Lee and Solon model are unlikely to adequately control
for intra-age group variation, which appears even more pronounced when
instrumented in the case of Sweden.10 Hence, it seems that 0.277 should also not be
taken as an adequate measure of IGE for the UK.

(1)(e) Eberharter (2013)

In an interesting advance on Ermisch & Francesconi (2002), this author conducts a
cross country study using BHPS data for Great Britain only in order to analyse
the influence of individual and parental socioeconomic characteristics such as
family disruption on intergenerational income mobility. Acknowledging that the
BHPS does not provide a sufficiently long time horizon over which to best
approximate Eq. (1), the BHPS sample is restricted to those persons aged 14 to 20
and co-resident with their parents during all of the first four years in the survey
(1991-1995), with child income measures observed when they are at least 24 years
old, yielding a combined sample of 1840 men and women. Only those participating
in the labour market at the time of measurement are included, thus excluding those
in full-time education. Given that by age 24 the vast majority of university educated
children will have already completed their undergraduate studies and will thus be
included within the authors sample, the implications of the HS and Eq. (9) neither
of which are referenced in this article strongly suggest that lifecycle biases will
persist, with IGE attenuated as before.
The main point of difference is that this study measures post-government
household income, meaning total spousal income plus public transfers (e.g. child
tax credits or unemployment benefits), pension payments, and with total household
taxes deducted. So as to adjust for differences in family size and account for
economies of scale, the author calculates the permanent household income per
10 The reason for this bias stems from the instrument chosen by the authors; parental education.

This aggravates lifecycle bias given that the correlation between parent and child education in
Sweden is shown to be high, which explains the negative coefficient when IGE is measured in
early adulthood. The approach of Ermisch and Nicoletti is to use various parental variables from
the BHPS data in the vector of controls, Z, which also includes parental education. Ultimately,
any one of these could similarly aggravate life cycle bias as above.

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adult using the Oxford equivalence scale, which assigns a value of 1 to the first adult
household member, 0.7 for any additional adult and a value of 0.5 for each child.11
Recent research by Hussain et al. (2009) has shown how sensitive IGE measures can
be to using different units of measurement for . Using Danish administrative data,
annual earnings (both including and excluding sickness pay and unemployment
benefits) and hourly wage rates are each used to compute benchmark estimates
from lifetime income data. A significant difference emerges between father/son IGE
based on hourly wage rates (0.224) and earnings exclusive of unemployment and
sickness benefits (0.123); the latter being the measure most frequently adopted
in the UK research. Once sickness payments and unemployment benefits are
included with annual earnings, mobility decrease with IGE equalling 0.136. The
authors suggest this to be an indication that social heritage is stronger at the lower
end of the earnings distribution, again signalling that single population measures of
intergenerational dependence are potentially misleading. The authors also show
how applying the identification strategies adopted in other country-specific studies
to their data (see Table 2) can result in wildly different estimates of Danish IGE
( ). When is calculated using the same strategy as Blanden (2005) discussed
above, elasticity is reduced to just 0.09, which only serves to underline how that
authors estimates likely overstate UK mobility.12 Hussain et al. conclude that hourly
earnings are inherited from the parents to a larger degree than annual earnings
(wage rates * hours of work) and after receiving public income transfers. A lower
dependence of annual earnings could imply that those on lower (higher) wages tend
to work more (less) hours on aggregate so as to equalise total incomes somewhat,
thus moderating perceived intergenerational inequalities. Hourly earnings might
then be seen as a more appropriate measure in capturing peoples lived experiences.
Ultimately, there is no accepted method for determining equivalence scales (OECD 2011),
meaning that this arbitrary inflation of permanent household income per adult may not truly
reflect actual household consumption patterns (i.e. may over or under state lived economies of
scale, which is likely to differ across the income distribution). Unfortunately the author does not
check the robustness of her findings using different equivalence scales such as the OECD
modified scale or the square root scale.
12 As can be seen from Table 2, Hussain et al. (2009) compute using the identification
strategy used by Blanden with respect to West Germany only. This differs from the one adopted
for the UK in so far as fathers monthly earnings are measured as a five year average, whereas
only two years of parental earnings data are available for the UK. This would suggest that if
were also computed using Blandens method for the UK, would very likely be even smaller.
11

- 17 -

Yet irrespective of which of these measures is the most normatively revealing, the
forgoing suggests that we should not be surprised if Eberharters IGE estimates
differ significantly from those discussed so far, complicating the present writers
search for a preferred measure of UK elasticity.
In addition to estimating the simple relationship between parent and child
household incomes as in Eq. (2), the author estimates a version of Eq. (3) which now
includes a dummy for gender as well as other family background characteristics.13
The authors first measure of IGE equals 0.504, which is reduced to 0.4 once family
background characteristics are controlled for. It is interesting to see why this
increase in mobility is observed. The authors results (presented in columns 2 and
4 of Table 3) show that independent of household income, parental occupations
classed as academic, scientific, managerial or professional are positively correlated
with log child outcomes and are highly significant, whereas this is not true of lower
status parental occupations. Once again, this serves to highlight important
nonlinearities in these constant linear estimates of IGE. Regardless, the study
underlines how sensitive elasticity estimates can be both to the choice of income
measure and omission of background covariates, meaning inferences from all these
studies employing a limited number of identification strategies should be treated
with great caution.

(1)(f) Gregg et al. (2014)

In the most recent extension of the UK research, these authors try to provide the
first ever estimates of lifetime IGE akin to Eq. (1) using the BCS. We are told that the
strapline lifetime is justified given that we are now able to include nine waves of
BCS individual income data on sons from birth through ages 5, 10, 16, 26, 30, 34, 38
and 42. As was previously observed from Swedish administrative data, this would

These variables are: individual and parental education, phases of unemployment in the
parental household (taking value 1 if either parent is employed for less than half the sample
period), parental occupation, dummies for own and parental family disruption (taking value 1
if the status of a respondent or their parent is widowed, divorced or separated), a health status
dummy (which takes value 1 if one of a childs parents are subjectively defined as in good health)
and finally a disability status dummy for both parents and their children which takes value 1 if
either party is disabled. With regards to the parental occupation variable, , the author constructs
four categories of occupational groups: 1 academic/scientific/professional/managers, 2
professionals/technicians/associate professionals, 3 trade/personal services and 4
elementary occupations.
13

- 18 -

cover the period in an adults working life where current incomes best proxy
average lifetime incomes, assuming the UK follows a similar lifecycle trend. Indeed,
the authors show (see Figure 8) that the UK data does seem to mimic this trend, with
elasticity estimates from the BCS rising over the lifecycle and peaking in the last
wave. One factor that may generate bias acknowledged by the authors is that BCS
data is so far unable to inform on patterns of labour market exit as individuals reach
retirement age. Hence, as lifetime earnings are measured as a log average taken
across all observed earnings periods, the actual data pertains to a prolonged
snapshot of lifetime income only. Second, they also note that as data on parental
incomes are available for at most two time periods (when the child is aged 10 and
16), transitory fluctuations in parental income will likely attenuate their results
through classical measurement error, which should therefore be seen as a lower
bound, or 80% of according to some suggestive reasoning.14 Yet despite these
concessions, there remain further reasons to doubt the authors optimism in being
able to estimate Eq. (1) using the BCS. First, the large four year measurement gaps
over the adult stages of the sons lifecycles provide an imperfect proxy for income
between ages 26-42. Even if an individuals point-in-time observations do not
appear to show any idiosyncratic transitory divergences from their expected
lifetime incomes, the four year gaps between these data points leave enormous
scope for incomes to fluctuate wildly (for instance, due to job losses) and then
return to what may spuriously be considered a trend. For instance, Robert Valletta
(2006) has shown that Great Britain has relatively high rates of entry and exit to and
from poverty, and a relatively low average duration with 69% of poverty spells
lasting between 1 and 2 years. In short, a complete set of data points at each age as
provided by administrative data is the only means of obtaining a true measure of .
A further advantage of administrative data over cohort studies is that there is
currently no consensus as to the best way of collecting self-reported income data.
Hansen and Kneale (2013) analyse the UKs most recent cohort study (The
Millennium Cohort Study, MCS) which follows the same structure as the earlier
Citing the earlier work of Gregg et al. (2013), the authors show that using just two current
estimates of parental income when applied to Swedish administrative data meant that
estimated elasticity was 80% of the true lifetime income elasticity when complete parental
income histories are known.
14

- 19 -

BCS to test whether the way in which survey questions are put to respondents
changes their observed economic status. The authors find that little consistency
exists particularly with regard to survey respondents from the lowest income
quartile between annual figures reported when total income is derived from a
single question and between estimates constructed by the researcher from multiple
constituent questions.15 Looking at subgroups of the population, those that might
be seen as vulnerable for example, households headed by part-time workers
tend to record higher incomes through multiple questions than single question
income measures (see Figure 9). The family income section of the BCS questionnaire
(replicated in Box 1 below) does ask respondents for information on gross income
derived from a list of sources. However, for many people recalling annual totals for
each of these may be difficult, particularly in the case of those with unstable or
seasonal employment. Moreover, those providing information (who may only be the
partners of the original male cohort member) are required to be aware of both
persons annual incomes from each given source, which may aggravate these effects.
To sum up, the monthly earnings figures derived from the annual income data used
by Gregg et al. may suffer from a great deal of left side measurement error relative
to administrative data. Crucially, the size of the error is likely to vary across the
income spectrum due to both higher inconsistency in lower quantile incomes
(which I will denote by the error term below) and the hypothesised difficulties
that vulnerable households in particular may face in accurately reporting their
incomes as suggested by analyses of the MCS (denoted ).
Does this mean we can consistently estimate ? Probably not, although not for any
of the reasons discussed in the literature to date. Although the authors do
confidently assert (p7) that their data likely overcomes the problems identified by
the HS model and Eq. (9) with respect to heterogeneity in the trajectory of income
profiles over the lifecycle, standard econometric theory tells us that measurement
error in the dependant variable, = ( + ), will only bias our estimates (as

The authors show (p10) that when income is based on a single question using the midpoint
of the interval of banded groups, gross annual income for the bottom quartile is 14300.
However, when income is collected from multiple questions (excluding information from
respondents with logical inconsistencies in their reporting) gross annual income jumps to
18244.
15

- 20 -

opposed to merely reducing the power of statistical tests) if the following conditions
hold:
=
=

( , 1 )
(1 )
( + 1 + + , 1 )
(1 )

(1 )
(1 )

= iff {

(1 , ) = 0
a

(1 , ) = 0

(11)

The result is something similar to Eq. (7), whereby the elasticity measure is
unbiased only to the extent that joint parental income (the 1 measure used by
Gregg et al.) is uncorrelated with the measurement errors in . If sons at the
bottom end of the income distribution do experience greater instability between
BCS waves as suggested, as well as lower probabilities of reporting their incomes
accurately, then the use of such cohort studies for the study of IGE will be limited by
yet another form of bias that so far remains undocumented. Indeed, the approach
taken by Gregg et al. (2013) in piloting a UK specific restriction on another countrys
administrative dataset (see n14) might be one route to better inform ourselves of
how this further bias might affect our limited UK data sources. For instance, a
benchmark estimate of Eq. (1) could be compared with a sample where data points
are deleted across the entire population of sons at ages 27-29, 31-33, 35-37 and 3941 i.e. those ages for which the BCS lacks data or where these data points are
deleted across quartiles sequentially so as to test whether a particular section of the
distribution is more affected by these potential biases as suggested.

- 21 -

Box 1: Family Income Data Survey Question (Section 10, Family income (BFAMINC)): Source:
British Cohort Study 2008/9 Questionnaire documentation Centre for Longitudinal Studies
(2008). (p97)
INCS
I now want to talk about income from all sources. Can you please tell me which kinds of
income you [^and name of partner] currently receiveREAD OUT INTERVIEWER:
CODE ALL THAT APPLY
01 Earnings from employment or self-employment
02 Pension from a former employer
03 State Pension 04 Child Benefit
05 Income Support
06 Other State Benefits
07 Tax Credits
08 Interest from savings etc.
09 Other kinds of regular allowance from outside the household
10 Other sources of income e.g.: rent?
11 (DO NOT READ OUT) No income
[Code maximum 10 out of 11 possible responses]
CHECK FI1
IF cohort member reported receiving income from one or more of the sources at INCS
[(INCS = RESPONSE) AND NOT (INCS = 11)]
|
| INCAMT | Can you tell me what is your (s) [^and name of partner]s total annual income
from [^this
| source/all these sources] before tax and any other deductions?
|
| INTERVIEWER: RECORD AMOUNT IN POUNDS
| IF 1 MILLION OR MORE, ENTER 999999.
| IF DONT KNOW ENTER CTRL+K.
| Range: 0999999

Despite the above limitations, the authors do make two key contributions to our
discussion. First, as an alternative measure of intergenerational dependence they
estimate the rank-rank coefficients following Chetty et al. (2014a):
= + 1 +

(12)

The advantage of such positional measures is that they are insensitive to the
marginal distributions of father/son incomes as mentioned previously, with IGE
related to the copula of the distribution (i.e. each generations relative income
ranks) only. Second, the authors consider the impact of including spells out of work
for the first time using UK data. Their preferred method is to impute the average
amount of unemployment benefits that someone out of work would receive over a
period, with the analysis layered to sequentially include those who are found
- 22 -

working in at least 1 but not all waves (10.4% of the total sample), and those who
never work (3.3%).
The authors first estimate lifetime IGE as 0.372 when two parental data points are
averaged. The rank-rank measure is smaller at 0.3, suggesting that a significant part
of the first result is driven by income inequality. When those who do not always
work are added to the sample, rises to 0.398 using the preferred measure of
imputed benefits, with the rank-rank coefficient displaying little change. When
those who never work are included, rises again to 0.430, while the rank-rank
coefficient again remains steady. This last figure implies far less mobility than
suggested by earlier BCS estimates, highlighting the importance of using multiple
child income data points and including those without earnings. Nevertheless, for the
multitude of reasons cited above, this too likely represents a lower bound estimate.

- 23 -

Discussion
With the exception of several studies omitted from this review owing to their
repetition of methodologies and results (Blanden et al., 2006; Blanden, 2007;
Blanden & Machin, 2008; Blanden 2009; Blanden, 2013; Blanden et al., 2014), the
preceding analysis should be seen as a fair representation of the state of UK
research. The repeated pattern across this collective body is that current estimates
are both highly sensitive to changes in specification, and in all cases would appear
to understate intergenerational continuities in economic status. Following the
advent of the UK Administrative Data Taskforce in 2011, high quality de-identified
administrative data may soon be available to researchers, offering the potential to
alleviate the current difficulties we find in attempting to identify a single reliable
estimate of IGE. In spite of this, several extensions could still be made to the above
works using available data sources. First, researchers should report estimates using
alternative measures of income and earnings following Hussain et al. to improve
comparability. Second, in order to ameliorate the current Three-Bears-like
scenario in which lifetime BCS data appears unreliable given the infrequency of its
cohort observations following Eq. (11), while the BHPS despite decreasing the risk
of unobserved income variability through regular annual observations could also
prove unreliable owing to its small sample sizes within different age ranges, greater
use could be made of rank mobility measures. To see why, consider the analysis of
Nybom and Stuhler (2015) who in addition to studying lifecycle biases in linear
correlations also test rank correlations using the same Swedish tax data. As can be
seen from Figure 10, the single year age specific rank correlations approximate the
true lifetime income measures of IGE reasonably well, remaining markedly stable
across the lifecycle. Rank correlations will be invariant to any rank preserving
spread, and hence we would expect this stability to reflect the fact that the ordering
of individuals is remaining comparatively constant beyond a certain age. Indeed,
this may be one interpretation of the rank-rank estimates reported by Gregg et al.
(2014), which appeared insensitive to changes in the sample as those included
simply fell into the bottom rank. To the extent that this is true, for our purposes their
result could imply that an average of consecutive rank observations for any
individual may not need to cover the bulk of that individuals working life so as to
mitigate the sorts of lifecycle bias implied by the HS model and Eq. (9), with the
- 24 -

lifetime joint distribution of parent and child ranks staying constant across
individual child ages despite underlying real measures such as income diverging
over the lifecycle. This finding opens up brand new opportunities to examine extant
UK data; an original example of which I present in Appendix A.
Despite these nominally optimistic conclusions, the reader may well be querying the
normative value of finding a correct estimate for average IGE at a national level. In
his classic critique of the standard measures of poverty, Osberg (2002) argued that
the poverty rate (whether relative or absolute) is the most consistently misleading
indicator of poverty trends for the UK as it ignores the depth of poverty experienced
by individuals; that is, the average percentage shortfall of individuals from some
arbitrary cut off. Similarly, those concerned for the welfare of the countrys poorest
(or with the inequity of having highly persistent top incomes), may query the utility
of an average measure of elasticity over one generation, which tells us next to
nothing about intergenerational dependence across specific sub-groups or about
any dynastic trends of the type modelled by Banerjee and Newman (1993).
Accordingly, Part (2) will now review the limited UK research expanding upon
classic mobility measurement.

- 25 -

PART (2) ADVANCES IN INTERGENERATIONAL MOBILITY

MEASURMENT
(2)(a) Nonlinear Analyses of Mobility
A concern alluded to throughout Part (1) was that IGE estimates may be unstable
because the UK income distribution is not well approximated by a bivariate log
normal distribution, with intergenerational dependence therefore not constant
across this range. Grawe (2001) provides an early attempt at considering these
differences using quantile regression. Although his analysis using the NCDS cohort
data falls foul of almost all of the bias inducing pit falls highlighted above,16 the
authors results are still interesting in so far as they demonstrate how IGEs may vary
when measured at different parental income deciles. For instance, while IGE at the
10th percentile equals 0.344, elasticity increases throughout the income distribution
reaching 0.814 in the 90th percentile. Later work by Bratsberg et al. (2007) has also
used the NCDS, this time measuring two gross earnings observations when children
are 33 and 41. Their estimates exhibit slight nonlinearity, rising from 0.322 at the
10th percentile to 0.412 in the 90th. These authors include all employed sons with at
least one valid earnings observation at either age in their sample, making this
analysis even more susceptible to attenuation from the lifecycle biases implied by
the HS model. More recently, Gregg et al. (2015) have found evidence of a strong
association between parental income and lifetime earnings for the lowest paid using
the same lifetime BCS samples developed by Gregg et al. (2014). The results for the
authors sample including the imputed value of benefits for observed periods of
worklessness (shown along the red line in Figure 11) exhibit a J shaped pattern in
elasticity over the income distribution. The implication here is that
intergenerational dependence in the UK displays both a sticky floor ( equals 0.414
at the 10th percentile, but just 0.348 at the 30th percentile) and a glass ceiling (
equals 0.652 at the 90th percentile), contrary to earlier results. Nonetheless, these
nonlinear estimates using the BCS are equally likely to be affected by the mooted

For example, the author uses child incomes measures during 1 year only at age 33. Further,
the NCDS only has one years worth of parental income data at its disposal, risking classical
measurement error.
16

- 26 -

biases described by Eq. (11), suggesting a further use for the proposed sample
outlined in Appendix A.
Other studies have ignored differences across all parental incomes, focussing solely
on a particular tail of the distribution. Blanden et al. (2010)(see also Gibbons and
Blanden, 2006) estimate a version of Eq. (2) using the BCS data, where the
outcome is determined by the binary slope coefficient, . This variable takes on
value 1 if an individual grew up in a household experiencing poverty when aged 16,
with the resulting from this regression model, (ln( ) = + + ), now
interpretable as the average adult income disadvantage. The authors measure
adult earnings for the childrens generation at age 34 only, with the single year
family poverty measure at age 16 defined as a household with less than 100 per
week gross income. The results show that childhood poverty is negatively
associated with average earnings, decreasing by 11.5%. Of course, the discussion
in Part (1) would suggest that this alternative dependence estimate is severely
attenuated by both left and right side measurement error, with Valletta's (2006)
study of the dynamics of poverty providing suggestive evidence that a single year
family measure is likely to be an extremely noisy proxy for . Other studies have
employed nonparametric methods for the study of IGM, notably transition matrices.
For example, Eberharter (2013) ranks country level quintile transition matrices
using a Bartholomew Index. In contrast to the authors estimates for standard IGE,
the index ranks Britain below the US as a less mobile country. Different authors use
varying techniques to summarise matrices. For instance, Blanden et al. (2002)
characterise quartile matrices for the NCDS and BCS by computing an immobility
index through summing the ten proportions contained in cells along and adjacent to
the main diagonal. Setting aside the fact that both of these studies were shown to
use potentially biased data in Part (1), one might also question the normative appeal
of both their choices of indices in so far as both give weight to mobility throughout
the entire sample, which may not be particularly informative about the lived
experiences of people at the extreme ends of the income distribution. Furthermore,
neither produces a summary statistic that is easily interpretable. With this in mind,
I present a simple alternative index measure in Appendix B which focusses on the
corner values in a matrix so as to take greater account of sticky floors and glass
- 27 -

ceilings. I find that when this alternative index is applied, Eberharters ranking is
reversed with Britain now slighly more mobile than the US.
Despite failing to rid elasticity measurements of nearly all of the biases emphasised
in Part (1), this nascent literature has highlighted a significant degree of
heterogeneity within population IGE estimates. However, several key omissions
from analysis remain. First, consider the descriptive statistics provided by Hills et
al. (2015) on the respective economic statuses of households from various ethnic
backgrounds taken from the UKs Households Below Average Income (HBAI)
dataset (see Table 4). At the median, Asian or Asian British families have a net
weekly income 26% below that of white households. Further, if we consider one of
the likely determinants of economic status, education, Figure 12 shows that
Bangladeshi and Pakistani working age adults remain by far the most likely to have
no formal qualifications. In light of these statistics, it would be surprising if
population IGE figures whether linear or nonlinear were an appropriate
summary measure for all ethnic groups. In the US, Mazumder (2011) has analysed
black-white IGM differences using several new measures which focus on the
direction of mobility.17 The authors results show that 50% of blacks born into the
bottom quintile of the income distribution remain there in adulthood, whereas just
26% of whites stay at the bottom in both generations. Unfortunately, the ability to
repeat such an analysis for the UK is severely limited by a lack of data on ethnic
minority groups across multiple generations. In 2009, the Understanding Society
(UKHLS) survey (which absorbed the smaller BHPS from wave 19 onwards) added
an ethnic minority booster sample (the EMBS) for individuals from the 14 most
prevalent ethnic groups living in the UK (ISER 2015). The temporal proximity of this
sample means that we must wait until a sufficient number of children from each
ethnic group mature before we can measure intergenerational dependence. One

The author first identifies that IGE is not a particularly useful measure for comparing
subgroups given that one IGE measure for a single subgroup tells you only the rate of regression
to the mean within that subgroup, and not across the overall multiracial distribution. While
several very similar measures are introduced as noted, the statistics quoted above are derived
using upward transition probability (UTP). This measure tells us the probability that a childs
income percentile (Yit) exceeds a given percentile s in the income distribution by an amount ,
conditional on the parents income percentile (Yit-1) being at or below s in the first generations
income distribution. This gives us the following measure: , = Pr( > + |1 ).
17

- 28 -

solution could be to create a generation t-1 sample through the parental occupation
data of first generation respondents, mimicking the sampling method of TS2SLS
estimation but now applying the nonparametric directional mobility measures of
Mazumder so as to compare different ethnic populations (see n26).
An equally important omission from the literature to date is any analysis of regional
variation in IGE. Dorling et al. (2007) map one year average annual incomes within
parliamentary constituencies across England and Wales (see Figure 13).
Predictably, the darkly shaded areas which imply a higher average constituency
income are concentrated in southerly regions. Assuming that the nonlinear UK IGE
estimates explored thus far are relevant for the population as a whole, then all these
higher income regions should display greater elasticity and vice versa. In another
US study, Chetty et al. (2014b) have provided the first estimates of local variations
in intergenerational dependence. They divide the entire country into a set of
geographic areas known as commuting zones (CZs), which are aggregations of
counties based on observed commuting patterns designed to span the area in which
people mainly live and work. Their rank-rank analysis focusses on the average
absolute upward mobility of children from families with below median parental
incomes within the national income distribution. Absolute mobility is defined as the
expected national income rank of a child who grew up in CZ c with parents who
have a national income rank of p:
= + .
Two features of this approach should be emphasised. First, as the rank-rank
relationship is linear (see Appendix A for a description of this particular measure)
the average percentile rank of children from parents with incomes below the
median simply equals the average rank of children born to parents at the 25th
percentile. Second, because parents and children are ranked at the national level,
the sum of the minimum mobility rank in any CZ (given by the intercept ) plus the
CZ specific elasticity measure at the specified percentile, , can be compared across
a common income distribution, making each an absolute local figure apt for
comparison. If quantile regression analyses such as Gregg et al. (2015) do produce
reliable elasticity estimates for an entire population, then we would expect
- 29 -

negligible differences in 25 across CZs given that they are ranked at the same
underlying parental income ( $28,800 at the 25th percentile of the national income
distribution). The authors results for absolute upward mobility presented in Table
5 (column 4) for the 50 most populous CZs show enormous diversity, with 25
ranging from 46.2 in Salt Lake City to 35.8 in Charlotte; an average difference of
more than 10 child ranks.
The reader may query the extent to which this diversity is driven by the sheer size
of the US, calling into question how suggestive this evidence is of similar regional
diversity existing in the UK. The authors do regress CZ upward mobility scores on
the USs nine census divisions,18 including 51 state fixed effects, and find that 36
percent of upward mobility variance comes from within states. Furthermore,
relatively close CZs such as Columbus (Ohio) and Pittsburgh (Pennsylvania) do
display huge diversity, despite being a mere three hour drive apart. However, even
more impressive granular variation within states has been found in another recent
analyses. Speaking at the University of Wisconsin-Madisons Lampman Memorial
Lecture, Chetty (2015) maps mobility inside the state of Wisconsin (Figure 14). The
measure of mobility used here is the probability that a child born to a family in the
bottom quintile of the national income distribution reaches the top quintile of the
national income distribution. Looking at the cities of Waukesha and Milwaukee, we
can see that a childs probability of rising from the bottom to the top is just 3.2% in
the latter and 13.2% in the former; much closer to the 20% mark that would imply
perfect mobility. These cities lie just 32km apart; 20 minutes drive by car. If such
diversity can be measured within a small geographic area, we may question the
utility of even quantile linear regression estimates, which risk providing an
unrealistic picture the UKs spatial heterogeneity in elasticities.

Census division is an official term used by the US Census Bureau which simply denotes the
bisection of the country into four census regions and nine census divisions.
18

- 30 -

(2)(b) Multigenerational Mobility

This most recent extension to the IGE literature has sought to chart mobility across
multiple generations (i.e. from grandparents, to parents, to children). As the data
requirements for such enquiries are extremely high, studies are limited to a small
number of countries. The prior absence of multigenerational studies from the IGE
literature in Part (1) has however been attributed to what Stuhler (2012) calls the
iterated regression fallacy. This refers to the implicit belief that regression toward
the mean between two observations implies perpetual regression across many
observations following an AR(1) process; a Galtonian fallacy in the spirit of
Friedman (1992) and Quah (1993). If we now denote the elasticity coefficient of
grandfathers economic status on the childs economic status as 1, the
grandparents lifetime economic status as 2 and keep all remaining notation
the same as in Eq. (1), then under the iterated regression fallacy:

1 =

( , 2 )
( 2 )

( 1 + , 2 )
( 2 )

= 2

(13)

This implies that if we were to take one of the UK IGE estimates from Part (1) - for
example, = 0.4 and attempt to infer the effect of parental income on their
childrens children from this alone, elasticity would simply equal 0.16. Another
generation on and the original advantage of one individual over another will have
all but dissipated through this exponentiation process ( 3 = 0.064). However, as
noted by Solon (2015), the assumption that advantage dies out at a geometric rate
is assumed without any theoretical justification. Indeed, one could think of several
sources leading to a much less rapid regression to the mean than is implied by Eq.
(13), such as the inheritance of social competence and other forces outside of an
individuals control that drive a wedge between their traits and incomes, thus
attenuating the rate of decay as modelled by Stuhler and Till-Braun (2015). If the
assumption is false, then standard IGE estimates will tell us nothing about the long
run persistence of advantage by masking latent factors in child outcomes.
An early attempt to test the accuracy of simple IGE exponentiation was carried out
by Lindahl et al. (2012), who were able to draw on a survey of all third graders in
the Swedish city of Malm in 1938. This dataset can now provide them with lifetime
earnings data from local tax registers for three consecutive generations of 901
- 31 -

families. The authors run separate simple regressions for each generational
connection. The estimated elasticity between parent and grandparent log earnings
is 0.356, while the coefficient for persistence between son and grandparent log
earnings is 0.184, which is greater than 0.126; that is, greater than if
intergenerational transmission follows an AR(1) process. Using the same Swedish
dataset, Adermon et al. (2015) study wealth mobility across multiple generations.
While the authors do find a strong rank correlation between the wealth of the child
and both the parent and grandparent generations independently, the grandparent
coefficient becomes small and not statistically significant when parental wealth is
included within the same regression. According to the authors, this means that they
cannot reject the AR(1) model of IGE,19 a result replicated by Dribe and Helgertz
(2015) using earnings data from a different Swedish provincial area.
Conventional data sources are so far unable to provide us with any information on
multigenerational transmission for the UK. However, authors have recently
attemted to sidestep this issue through an innovative rare surnames based
analysis which traces patronymic lineages in England from 1800 to 2012. Clark and
Cummins (2013)(see also Clark & Cummins, 2015) measure weath for an early 19th
century elite, middle and underclass, defined as such by the average probabted
wealth of a rare surname dynasty at death from 1858-1887. Here, a surname is
classed as rare only if it has a frequency of 40 or less in the national census of 1881.
By grouping individuals by their common (but societally rare) patronyms through
time, the authors hope to foregoe the neccesity of linking individuals directly from
one generation to the next, enabling them to measure the average probated wealth
at death for five birth cohorts (1780-1959). Figure 15 shows a time series of average
log probate values for rare surnames grouped by their respective classes of
anncestoral wealth in 1858-1887. Although convergance is plainly occuring, the
average wealth of the richest surnames from 1858-1887 are still 5.6 times that of
the poorest surname group by 2011. The authors also estimate measures of
Although not explained by the authors, see that observing a positive grandparent coefficient
once parental wealth is controlled for is just the flipside of a less-than geometric decay of
multigenerational associations, although the causal process of this may not be due to any
independent action of the grandparents themselves, and may be attributable to anything from
social class, market luck or genetics. See Stuhler & Till-Braun (2015, p13).
19

- 32 -

elasticity for all surname dynasties across all birth generations, the results of which
are shown in Table 6. While the adjacent generation estimates (shown in bold) are
consistently high throughout time (averaging 0.59, excluding the most recent birth
cohort measure),20 the rate of regression is also slower than implied by naive
exponentiation. The result is that for those whose ancestors born 1780-1809
enjoyed twice the wealth of another persons ancestors, today these will retain a
12% wealth advantage on average. In related work, Clark (2014) also presents
estimates (see Table 7, Column 2) for the more than 4,000 farther son pairs
throughout the study period whose surnames are so rare that true single
intergenerational linkages can easily be traced within censuses. Unfortunately
however, this method has been unable to generate data on true multigenerational
linkages. While some have queried the representativeness of the authors sample
(see Corak 2014), these works underscore the importance of seeking new estimates
of IGE beyond the single transmission literature explored in Part (1) for the UK.

This estimate is likely biased downwards by the disproportionate number of wealthy

individuals that have not yet died by age 81.
20

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PART (3) AN AGENDA FOR FUTURE RESEARCH

Box 2 below records eight areas identified by the present writer from the review of
extant UK materials as subjects that require further enquiry from future research.
Box 2: Evidence gaps identified from the UK mobility scholarship.
a) Direct evidence on the sensitivity of UK IGE estimates to variations in the Yi unit
variable following Danish research (Hussain et al. 2009). Quantile regression
analysis would also help to identify within which regions of the distribution
intergenerational dependence is most affected by a change in the income measure;
a question neglected by research pertaining to all countries to date which could
provide a normative rationale for a researchers choice of measure as discussed in
Part (1)(e).
b) Analysis of the BHPS using the more stable rank-rank mobility measures as
explored in Appendix A. This would provide the most contemporary estimates of
IGE from any of the existing UK data sources.
c) Differences in IGE across distinct ethnic groups identified in the EMBS. By creating
a parental sample through mimicking the first stage of TS2LS estimation used by
Ermisch and Nicoletti (2008) and assuming that the measurement error present
in instrumenting for parental income through their occupation status is not
correlated with any particular ethnic group researchers may exploit the UTP
measure (see n17) proposed by Mazumder (2011) to estimate racial differences in
mobility.
d) Whether left sided measurement error varies significantly across the income
distribution as in Eq. (11) and following the suggestive evidence discussed (i.e.
Valletta 2006; Hansen & Kneale 2012). Within this, the mooted effect that four year
measurement gaps in income observations have on IGE estimates derived from the
BCS data might be explored by piloting this restriction on another countrys
administrative data following Gregg et al. (2013) (see n14).
e) An exploration of alternative summary measures of mobility within transition
matrices following the critique of the Bartholomew index presented in Appendix B.
As many indices such as the one offered by this author are not independent from
the dimensions of the matrix employed (e.g. quintile or quantile), consistent use
should be made of a single size by researchers so as to facilitate comparison across
sources.
f) Knowledge of inter/intra-regional differences in intergenerational dependence
within the UK following Chetty et al. (2014b) and Chetty (2015).
g) Evidence on multigenerational elasticities and the long run prospects for
regression to the mean implied by Eq. (12) using direct as opposed to patronymic
intergenerational linkages following the Swedish literature presented in Part
(2)(b).
h) Suggestive evidence from foreign data sources with access to information on
complete lifetime incomes for each generation on the degree to which rank-rank
estimates derived from the regression model proposed by Less and Solon (2009)
are biased relative to a benchmark lifetime IGE (see discussion below).

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An important concern neglected by the present writer so far is the appropriateness

of measures such as income or wealth as opposed to actual consumption in
providing a proxy for individuals welfare from one generation to the next. Brewer
and ODea (2012) measure both income and expenditure for the same UK
households in a single generation using data from the HBAI survey. Their aim is to
ask which of having low reported income or having low reported consumption
is a better guide to being a household with low living standards. Figure 16 plots both
median household spending given a certain level of household income (grey line), and
the median household income given a certain level of household spending (black
line). The pattern shows that households with the lowest reported cash income
have reported expenditures commensurate with households with weekly incomes
of almost 400. However, this tick pattern does not hold along the black line (which
is approximately linear) as households with very low spending do also have very
low incomes. That incomes and expenditures must eventually balance suggests that
income here is subject to an enormous amount of measurement error relative to
spending, and may therefore be a poorer proxy for actual living standards
(particularly for those with lower reported incomes). A related concern is that while
nominal differences in peoples salaries might be large, university graduates often
experience an increased cost of living should they pursue higher paying jobs in
metropolitan areas, which decreases their real wage advantage as has been shown
for the US by Moretti (2013). Similarly, Broda et al. (2009) show using barcode data
from the US that those with household earnings over $100,000 per year tend to pay
between 2-3% more for the exact same grocery items than those earning between
$8000-$30000. If we factor in substitution biases (poorer individuals may consume
inferior or non-branded goods) then these findings further support the notion that
income is a far from perfect proxy for living standards. Unfortunately, the present
writer knows of no data source available for the UK that could be used to measure
consumption across generations. Still, the discussion above should serve to caution
against inferring too much about individuals lived experiences from IGE and other
estimates. The reader may also be concerned that no solutions have been advanced
to plug the evidence gaps highlighted in Box 2 concerning local and
- 35 -

multigenerational measures of intergenerational dependence. The remainder of

this part will therefore be dedicated to exploring feasible avenues of enquiry along
these lines.
One solution could be to mimic the surnames based analysis of Clark and Cummins
(2013) in regions where a sufficient number of rare patronyms can be found
throughout the sample period. Alternatively, one could explore locales which
experienced significant inward migration from abroad, providing an easily
identifiable group of names within the census data from whom later observees will
have likely descended. Take the example of Manchester. The Irish comprised 15%
of the citys population in 1851 after many arrived to escape the Great Famine of the
1840s. They were generally confined to inner city slums such as Ancoats and Angel
Meadow; areas recorded as 40% Catholic by the religious census of 1900 (Kidd
2002). In Clark's national analysis

(2014, p93), his sample of poor wealth

individuals with rare surnames is taken from the governments 1861 list of habitual
paupers. In a similar vein, easily identifiable Irish patronyms might be used to form
surname dynasties within Manchester, with evidence as to the average class of these
individuals suggesting that they would fall toward the bottom of the national wealth
distribution in early 19th century England.21 The sample might be balanced by
including another group of migrants less represented among the pauper classes
with easily identifiable surnames. By 1914 Manchesters Jews who originated from
Eastern Europe had formed the largest Jewish community outside London of
35,000; up from 10,000 in 1875.22 Today, Manchesters eruv23 is the largest in the
country, suggesting that the citys many Jewish residents today might descend from
those same migrants. Although similar analyses might be carried out for many of
the UKs other major cities although likely using different early migrant
communities such as the Italian-Scots of late 19th century Glasgow (see BBC 2004)

With many working in precarious employment, it is no surprise that between 1881 and 1914
one half of paupers in Manchesters New Bridge Street Workhouse were registered as Catholic,
as were a third of prisoners at Strangways jail (Kidd 2002, p121).
22 Evidence tells us that instead of joining the Irish in Manchesters poor houses, Jews had their
own community funded Manchester Jewish Board of Guardians to provide welfare for the needy
(see Kidd 2002, p123), which ultimately led to far fewer falling into destitution, which may then
balance the sample somewhat.
23 An eruv is a wire boundary which is symbolic in the sense that it allows orthodox religious
Jews to carry or push certain items on the Sabbath. See BBC (2014).
21

- 36 -

 this approach is replete with concerns over the representativeness of these

migrant samples to the population as a whole and their local attrition; that is,
concerns over whether those still living in the same regional area as their putative
ancestors are themselves representative of a given surname dynasty. Furthermore,
such an analysis would still fail to provide estimates of direct multigenerational
transmission through families.
My preferred proposal would advance prior work by exploiting a unique and newly
available dataset pertaining to the city of York. Moreover, I believe this to be the
only UK data source which can provide either a sample of non-trivial size for the
study intergenerational dependence at a local level or estimates of mobility across
three or more generations through direct familial linkages, as in the Swedish
studies. The data pertains to a survey carried out by Atkinson, Maynard and Trinder
(hereafter ATM) between 1975 and 1978. The sample studied were the children of
families who took part in an earlier investigation into the working class population
of York organised by Seebohm Rowntree in 1950. This restricted focus toward
working classes defined as households where incomes do not exceed 550 per
annum eliminates approximately the top 20% of earners (Atkinson et al. 1983),
which still leaves the majority of the income distribution free for analysis.24
Although only 1,363 of a total 2,011 Rowntree survey returns survived, ATM were
able identify 826 families with surviving children, giving a potential sample of 2,236.
Of these, the authors traced and successfully surveyed 1755 Rowntree children for
their study (Atkinson et al. 1978).
Could these authors work be used to conduct a meaningful follow up survey for
three generations of Rowntree families? This would depend on the information
contained in the survey returns. While their contents have been the subject of prior
speculation (Jones 2014), in August 2015 these files were lodged at the University
of Yorks Borthwick Institute for Archives. Having been granted access by Professor
Tony Atkinson (Nuffield College, Oxford) for their conditional use, the present
writer can now reproduce for the very first time a complete (de-identified) copy of
One advantage of this data is that Rowntree was able to collect earnings information directly
from employers and from the National Assistance Board, who supplied details for 127
households on their welfare recipience. This should ameliorate concerns over the unreliability
of this early data (see Atkinson et al. 1978).
24

- 37 -

ATMs original survey, which is contained in Appendix C. Looking at Section B

(Employment), we can see that a great deal of information is included beyond single
income figures. For instance, respondents were asked (section B.4) whether their
gross pay typically varies, and if so, what are the normal ranges of variation. Further,
section B.3 includes a box for interviewers to check if they have been shown proof
of income from pay slips, which would help us to conduct robustness test with
restricted samples of parents who did evidence their earnings. Finally, the authors
also include several questions on National Insurance payments, tax payments,
housing costs and other expenditures from which they may calculate a households
net resources, which would enable researchers to test intergenerational
dependence using variety of Yi unit variables following Box 2(a). In sum, it would
seem that the information contained in these returns would be a sufficient base
from which to launch a further survey. Moreover, as Rowntrees earlier 1936 survey
pre-dated modern sampling techniques, and thus attempted to survey the workingclass population of York in its entirety (61.5% of Yorks population were actually
surveyed, see Jenkins & Maynard 1981), in some cases families may be linked even
further back in time to provide income data on four or more generations, which
would be a truly unique sample even by international standards.
Two final issues remain. First, both the 1950 and 1978 surveys contain only one
income observation for each generation. Second, the ages of respondents and their
parents observed in ATMs survey (see Table 8) display enormous variation, which
risks producing severely attenuated three generation estimates. Both of these
concerns could be mitigated by a variant of the analysis proposed for the BHPS in
Appendix A. As before, a rank-rank specification per Eq. (12) will likely prove less
sensitive to lifecycle biases. So that a prospective sample is not limited to those
interviewed (and whose parents and grandparents were also interviewed) around
a common age, a researcher could adopt the method proposed in the Appendix;
namely, ranking individuals within the national income distribution for their given
age using the Survey of Personal Incomes, subject to data availability. As an
alternative, ages could be controlled for using a rank-rank version of the model
presented by Lee & Solon (2009) discussed above. As has been noted by Palomino
et al. (2015), this methodology permits the exploitation of the entire pool of data by
- 38 -

estimating IGE with all available pairwise observations of sons and parents income,
while controlling for the influence of the life cycle on income of both parents and
children. Unlike the simplified version presented by (Ermisch & Nicoletti 2008), the
complete Lee and Solon model includes an interaction term between parental
income and the age of the son, which tries to account for the possible divergences in
lifetime income patterns depending on parental income as was highlighted in Eq.
(9). Nybom and Stuhler (2013, p14) have tested this log-log model on their Swedish
administrative data and found that estimates still differ by almost 20% from the
benchmark elasticity based on lifetime incomes, even when a large number of
income observations are used per son. The extent to which rank-rank mobility
estimates are subject to the same degree of bias so far remains unexplored by the
literature, but might offer researchers another more flexible strategy to incorporate
respondents of varying ages into their analyses when few observations in each
generation are available. This is a matter which I leave for future research.25

25

Briefly, it might be thought that as a rank-rank variant of the Lee and Solon model would control
for age within the sample, differences in the sample size across each age group would probably
mean that the copula or marginal distributions of each of these age specific ranks would be very
unstable, which would likely bring a downward bias on our estimates of mobility.

- 39 -

CONCLUSION
This essay has sought to provide an up-to-date review of extant research into
intergenerational mobility for the UK. The more recent contributions identified in
Parts (1) and (2) have provided us with some idea of how immobility is both
stronger and more concentrated among certain broadly defined income classes than
has previously been suggested. Nevertheless, the large evidence gaps highlighted in
Part (3) remain an important obstacle for us in understanding the true diversity and
long-run persistence of intergenerational dependence. Simply put, if as
emphasised by Atkinson (2015) it is child adult outcomes as opposed to
opportunities that should concern us, then we still have no idea how
predetermined economic status could really be and for whom.

- 40 -

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Stuhler, J. & Till Braun, S., 2015. The Transmission of Inequality Across Multiple Generations:
Testing Recent Theories with Evidence from Germany. Available at:
http://www.sofi.su.se/polopoly_fs/1.238308.1433311987!/menu/standard/file/Stuhler.p
df [Accessed September 5, 2015].
Valletta, R.G., 2006. The Ins and Outs of Poverty in Advanced Economies: Government Policy
and Poverty Dynamics in Canada, Germany, Great Britain, and the United States. Review
of Income and Wealth, 52(2), pp.261284.
Zimmerman, D.J., 1992. Regression toward Mediocrity in Economic Stature. American
Economic Review, 82(3), pp.40929.

- 46 -

Figure 1: Life cycle bias from estimating Eq. (6) with Swedish tax data. Lifecycle bias ( ) is presented along
the Y axis. Source: Nybom, M. & Stuhler, J., 2013. Heterogeneous Income Profiles and Life-Cycle Bias in
Intergenerational Mobility Estimation. (p24).

Figure 2: IGE estimates testing the empirical relevance of the HS model and Eq. (9) using left-hand side
measurement error in child incomes only. Source: Nybom, M. & Stuhler, J., 2013. Heterogeneous Income
Profiles and Life-Cycle Bias in Intergenerational Mobility Estimation. (p25).

- 47 -

Figure 3: IGE estimates testing the empirical relevance of the HS model and Eq. (9) using both left and right
side measurement error. Note that years on the X axis are normalised at 0 with respect to year t*, which in
Sweden is age 33. Source: Nybom, M. & Stuhler, J., 2013. Heterogeneous Income Profiles and Life-Cycle Bias
in Intergenerational Mobility Estimation. (p28).

Figure 4: The cross-national evolution of income shares among the top 0.1% of earners (1913-1998). Source:
Piketty, T. & Saez, E., 2006. The Evolution of Top Incomes: A Historical and International Perspective. (p15).

- 48 -

Figure 5: Mobility measures, benchmark vs. annual (left-hand side measurement error using Swedish tax data
from Statistics Sweden). Source: Nybom, M. & Stuhler, J., 2015. Biases in standard measures of
intergenerational income dependence, Working Paper 2015:13, IFAU. (p17).

Figure 6: Transition Matrix Concerning Intergeneration Continuities in Employers in York (measured 19751978). Source: Atkinson, A.B., Maynard, A.K. and C.G. Trinder (1983). Parents and Children: Incomes in
Two Generations. London: Heinemann. (p170).

- 49 -

Figure 7: IGE estimates testing the empirical relevance of the HS model using left side measurement error only.
IV estimates (denoted in the text) compared to both benchmark and OLS elasticity. Source: Nybom, M. &
Stuhler, J., 2013. Heterogeneous Income Profiles and Life-Cycle Bias in Intergenerational Mobility Estimation.
(p28).

Figure 8: First estimate of UK Lifecycle Bias in IGE estimations. Single year measures for BCS data with
parental incomes measured at age 16 (age 10 and 16 average) plotted in red (green). Source: Gregg, P.,
Macmillan, L. & Vittori, C., 2014. Moving Towards Estimating Lifetime Intergenerational Economic Mobility
in the UK. DoQSS Working Paper (p32).

- 50 -

Figure 9: Difference between estimated multiple and single question income values quoted for different social
groups within the Millennium Cohort Study. A value greater than 1 implies that single question income values
underreport gross annual income relative to multiple question measures. Source: Hansen, K. & Kneale, D.,
2013. Does how you measure income make a difference to measuring poverty? Evidence from the UK. Social
Indicators Research. (p11).

Figure 10: Rank correlation mobility measure, benchmark vs. annual (left-hand side measurement error using
Swedish tax data from Statistics Sweden). Source: Nybom, M. & Stuhler, J., 2015. Biases in standard measures
of intergenerational income dependence, Working Paper 2015:13, IFAU. (p17).

- 51 -

Figure 11: Quantile IGE regression estimates using the lifetime earnings samples developed by Gregg et al.
(2014). Source: Gregg, P., Macmillan, L. & Vittori, C., 2015. Nonlinear Estimation of Lifetime
Intergenerational Economic Mobility and the Role of Education. DoQSS Working Papers. (p30).

Figure 12: Highest qualifications by ethnicity (2012/13) taken from the UK Labour Force Survey. Qualifications
ranked from highest to lowest reading left to right along the horizontal bar. Source: Hills, J. et al., 2015. Falling
behind, getting ahead: the changing structure of inequality in the UK, 2007-2013 (Social policy in cold climate
research report 5). Centre for Analysis of Social Exclusion. (p47).

- 52 -

Figure 13: Average income for British (England and Wales only) parliamentary constituencies using bank
account data gathered by a subsidiary of Barclays Bank. Source: Dorling, D. et al., 2007. Poverty, wealth and
place in Britain, 1968 to 2005. Policy Press. (p66).

Figure 14: Mobility within the state of Wisconsin measured by the probability that a child born into the bottom
quintile makes it into the top income quintile in adulthood. Source: Chetty, R., 2015. Lampman Memorial
Lecture. Institute for Research on Poverty (IRP) Wisconsin Institutes for Discovery, University of WisconsinMadison.

- 53 -

Figure 15: Average normalised log probate values (including those not probated) over time for all rare surnames
grouped by their respective classes of ancestral wealth in 1858-1887. Probate values are normalised by the
average annual wage for a given year and include those not probated, who are assigned a normalised probate
value of 0.1. The common surname Brown is also graphed for illustrative purposes. Source: Clark, G. &
Cummins, N., 2013. What is the True Rate of Social Mobility? Surnames and Social Mobility, England, 18002012. UC Davis Working Paper. (p12).

Figure 16: Median value of a households spending given that households income (solid grey line), and the
median household income given household spending (solid black line). All values reported in pounds per week.
Source: Brewer, M. & ODea, C., 2012. Measuring living standards with income and consumption: evidence
from the UK - Institute for Fiscal Studies - IFS. IFS Working Papers (W12/12). (p48).

- 54 -

Table 1: Review of constant linear IGE estimates from UK studies.

Author(s)

Data
Source

(Y) Variable

Ermisch &
Francesconi
(2002)

BHPS
(waves 1-9)

Matched Sample
Monthly
Earnings,
[Average
Earnings]

Matched Sample
Gross Annual
Income,
[Average
Income]
Matched Sample
Instrumenting
for earnings
(IVED, IVUN,
IVFAM, IVHG)

)
(1-

)
(1-

(Yit,Yit-1)
(1- )

0.048

[0.059]

(0.952)

N
Child/Pare
nt Pairs

Age ranges studied

Child _ Parent

# Years of
Earnings/Income Data
Child _ Parent

16-29

(0.941)

421
father/son
pairs

51.1
(father
avg.),
48.5
(mother
avg.)

0.026

[0.047]

(0.974)

(0.953)

ED IV= 0.118

UN IV=

(0.882)

0.200
(0.8)

FAM IV =

HG IV =

0.221

0.108

(0.779)

(0.892)

Min = 1,
Max = 9

Min = 1,
Max = 9

Blanden et
al. (2002)

Blanden
(2005)

Ermisch &
Nicoletti
(2008)

NCDS
(waves 1-6)

Weekly
Earnings

0.098
(0.902)

0.047
(0.953)

Corr Eq.(3) =
0.120
(0.88)
Corr Eq.(4) =
0.058
(0.942)

2503

33

1 (child age
16)

BCS (waves
1-5)

Weekly
Earnings
[Average
Earnings]

0.219
(0.781)

0.162
(0.838)

2053

30

[0.273]
(0.727)

Corr Eq.(3) =
0.253
(0.747)
Corr Eq.(4) =
0.187
(0.813)

Min = 1
(child age 10
or 16), Max
= 2 (avg. of
child age 10
and
child
age
16
parent
observation)

Sons earnings
regressed on
Gross Family
Incomes [Two
Year Average
Gross Family
Income].
Controls for
ages across both
generations
included.

0.209
(0.791)

0.267
(0.733)

43.4
(fathers
avg. age)

Min = 1
(child age 10
or 16), Max
= 2 (avg. of
child age 10
and
child
age
16
parent
observation)

TS2SLS
estimation.
Multiple Yearly
Child Earnings
used as left hand
variable.

0.266
(0.734)

31-45

54-85

(42 avg.
main
sample),

Min = 1,
Max = 13

(37 avg.)

BCS (waves
1-5)

BHPS
(waves 113)

[1508]

1708

30

[0.281]
(0.719)

No Pairs:
7974
earnings
observation
s.

57-80

(53, sup.
sample)

Eberharter
(2013)

BHPS
(excluding
respondents
in full time
higher
education)

Postgovernment
Equivalised
Household
Income (see
text).

0.504
(0.496)

Gregg et al.
(2014)

BCS
(waves 1-8)

Individual Son
Income
Regressed on
Joint Parental
Earnings
(measure
includes those
who never
report any
earnt income)

0.430
(0.57)

0.4
(0.6)

1840 (men
and
women)

29-37

4312

26-42

5 (20042008)

38 (Father
avg.)

5 data points
between
ages 26 and
42

2 (avg. of
child age 10
and
child
age
16
parent
observation)

Table 2: IGE results from applying different authors identification strategies from a selection of international
studies to Danish administrative data ( , column 1). Source: Hussain, M.A., Munk, M.D. & Bonke, J., 2009.
Intergenerational Earnings Mobilities How Sensitive are they to Income Measures? Journal of Income
Distribution, 18(3), p.79. (p20).

- 58 -

Table 3: Multinational IGE estimates controlling for various family background characteristics. Source:
Eberharter, V. V., 2013. The Intergenerational Dynamics of Social Inequality Empirical Evidence from Europe
and the United States. SSRN Electronic Journal. (p27).

Table 4: Weekly net incomes by ethnicity (2012/13) taken from the Households Below Average Income
dataset. Source: Hills, J. et al., 2015. Falling behind, getting ahead: the changing structure of inequality in the
UK, 2007-2013 (Social policy in cold climate research report 5). Centre for Analysis of Social Exclusion.
(p55).

- 59 -

Table 5: Absolute Upward Mobility (column 4) in the 50 most populous commuting zones (CZs). Source:
Chetty, R., Hendren, N., Kline, P. & Saez, E., 2014. Where is the Land of Opportunity? The Geography of
Intergenerational Mobility in the United States. (p1594).

- 60 -

Table 6: Elasticity estimates between Birth Generations. Two-way combinations between adjacent generations
shown in bold along the diagonal. Source: Clark, G. & Cummins, N., 2013. What is the True Rate of Social
Mobility? Surnames and Social Mobility, England, 1800- 2012. UC Davis Working Paper. (p18).

Table 7: Elasticity estimates for wealth at death single generation transmission. Column 2 displays estimates
using true linkages between fathers and sons with rare surnames. Source: Clark, G., 2014. The Son Also Rises:
Surnames and the History of Social Mobility. Princeton University Press. (p95).

- 61 -

Table 8: Age of respondents and parents of respondents in ATMs survey of the Rowntree children. Note that
parental age is defined as the fathers age unless households are headed by single mothers. Source: Atkinson,
A.B., Maynard, A.K. and C.G. Trinder (1983). Parents and Children: Incomes in Two Generations. (p66).

- 62 -

APPENDICES
Please be aware that none of the content contained in any of the below entries (AC) has been included in the present writers final word count. The purpose of these
appendices is to provide evidence and theoretical proofs for the points raised in the
text only.

(Bradshaw 2013)
(Jones 2014)
(Jenkins & Maynard 1983)
(Atkinson et al. 1978)
(Becker & Tomes 1994).

(Bjrklund & Jntti 2011)

- 63 -

APPENDIX A: BHPS RANK-RANK STUDY PROPOSAL

Following the discussion above, here I present a new method for the study of IGE in
the UK that applies the rank-rank mobility measure displayed in Eq. (12) to the
BHPS data. My approach is inspired by the work of Chetty et al. (2014b) who also
consider measures of rank mobility, albeit applying very different sampling
methods and identification strategies to their US administrative data.
It is first important to consider what options actually exist to study IGM through
standard non-rank based measures of IGE. Following the first wave of the BHPS in
1991, we now have 21 full waves of data at our disposal, with the last three waves
of the BHPS forming part of the much larger Understanding Society (UKHLS) survey.
So as to mimic the study of Gregg et al. (2014) but with yearly observations
mitigating the concerns presented in Eq. (11) as discussed we may want children
to be at least 45 years old by the time wave 21 is reached so that we may gather data
points across a large part of the adult lifecycle; an imperfect proxy for Eq. (1). This
means that we would wish to limit our sample to people who were at least 24 years
old in 1991. However, because we need a range of incomes across adulthood in
order to calculate lifetime incomes, given that elasticities measured in early (late)
adulthood tend to understate (overstate) intergenerational dependence as shown
in Figure 2, it may be appropriate that the age range is also restricted at the top to
those who are no older than 30 in 1991. Including dummies for the age at which the
child respondent entered the BHPS (xECAGEi) and the first observed age of the
parent ( ) both indexed by age x to control for exogenous year specific
changes in the macro economy likely to have a differential impacts on individuals at
various stages of the lifecycle, the full model to be estimated would be:
ln( ) = + ln(1 ) + +

(1A)

Unfortunately, obtaining a reliable estimate from Eq. (1A) is almost certainly

unfeasible in reality. The major drawback of the BHPS is that in order for parents
and children to be linked, they have to be living with one another in at least one
wave of the survey (see Ermisch & Nicoletti, 2005). If our sample range is 24-30 as
suggested above, then the data would pertain to individuals within that age bracket
observed living with their parents, which is sure to result in a very unrepresentative
- 64 -

sample of individuals. Hence, using the BHPS to approximate Eq. (1) requires
limiting any sample to those who we would ordinarily expect to be living with their
parents such as 18 year olds (i.e. those coming to the end of their secondary
educations). A sample of 18 year olds would mean that after 21 waves of the BHPS,
the maximum age of children in the sample would be 39, which would somewhat
limit our ability to gain a measure of true lifetime incomes. Furthermore, we would
likely have to include a range of child ages measured in wave 1 BHPS to obtain a
non-trivial sample size. Therefore, if we were to use individuals aged 16-18 only,
the ages of these children in the final waves of the survey would be 37-39; an
imperfect proxy for lifetime incomes. When we restrict the data to this age interval
(see Table 1A) the resulting sample size of 546 is extremely small, and includes both
male (312) and female (234) respondents. Further, in pertaining to the first wave of
the BHPS only this figure does not account for attrition, and is also likely include
some individuals with zero income.
Table 1A: Number of 16-18 year olds (wave 1 BHPS)

Variable
aage

Obs

Mean Std. Dev.

Min

Max

546 17.02198 .8079153

16

18

Eberharter (2013) gets around these concerns through simply ignoring lifecycle

biases stemming from both the HS model and Eq. (9) in including children as young
as 11 in the first wave of the BHPS. But how could using rank based measures
improve upon the analysis outlined above?
To explain this, a review of Chetty et al.'s work will be instructive. These authors
estimate Eq. (12) with respect to each generations ranks of earnt incomes. The
authors motivation for this specification stems from the instability of US IGE
estimates using the log-log regression as in Eq. (2); a conclusion that has been
shown to apply with respect to the UK. For instance, log-log specifications must
discard observations with zero income (log(0) is undefined), which they suggests
overstates the extent of mobility. If these zeros are bottom coded at $1, the authors
estimated IGE jumps from 0.344 to 0.618. If instead $1,000 is used as a lower bound
- 65 -

annual income, IGE is estimated at 0.413. Further, with a sample size of over 40
million the authors are able to spot that the US income distribution is not well
approximated by a bivariate log normal distribution (see p1574), which in our case
serves to reaffirm the notion that a maximum potential sample of 546 as in Eq. (1A)
is inadequate. Ranking individuals by their incomes does however show a linear
pattern (see the authors Figure II), with those with zero incomes now simply
ranked in the bottom percentile rank.
While these are two definite advantages of employing ranked measures, the real
improvement can be seen when we consider the authors robustness checks. In their
baseline analysis, parent income is measured as mean family income from 1996 to
2000, and child family income as mean family income in 2011-2012 when the child
is approximately 30 years old. Child income is thus measured across just two annual
periods, and at a relatively young age. Immediately, alarm bells should ring
following the present writers discussions in Part (1) concerning the HS model, Eq.
(9) and the mooted concerns stemming from Eq. (11). In short, there are plenty of
reasons to consider that these authors estimates are measured with significant
error. Not so. Recognising concerns that child lifetime incomes have steeper
earnings profiles when measured at younger ages, the authors plot estimates of the
rank-rank slope by the age at which the childs income is measured (Figure 1A
below) using two samples from their data covering ages 22-42.26

26 Note that this method is slightly different from the one adopted by Nybom and Stuhler (2013)

in Figure 10, where rank elasticity estimates for the same children are measured across an
interval of ages, whereas here the authors estimate elasticity scores for age groups consisting of
different individuals. Chetty et al. (2014) do note however that similar results are obtained
when tracking a single cohort.

- 66 -

Figure 1A: Age specific measures of rank mobility (child incomes). Source: Chetty et al., 2014. Where is the
Land of Opportunity? The Geography of Intergenerational Mobility in the United States. (p1579).

The rank-rank slope rises steeply in the early 20s as children enter the labour force,
but then shows stability at around age 30. It increases by 2.1% from age 30 and 31
and 0.2% from age 31 to 32. After age 32 the estimates remain roughly constant.
Following the discussion in the main text, these findings further evidence that rankrank measures exhibit little life cycle bias provided that child income is measured
around 30. This means that a single year point estimate of Eq. (12) should be less
affected by the types of biases implied by the HS model and Eq. (9). While not
considering the concerns the present writer has highlighted in Eq. (11) directly, the
authors do also experiment with varying the number of years used to measure the
childs income (see Figure 2A). The rank-rank slope increases very little when
increasing the number of years used to compute child family income, with no
detectable change once one averages over at least two years. This likely implies that
those with the most transient incomes are at the very bottom of the income
distribution anyway, whether they are earning or not. Hence, a single year
observation of someones rank is not a particularly noisy measure, which is another
great advantage of this specification.

- 67 -

Figure 2A: Varying the number of years used to compute child income against measured rank mobility. Source:
Chetty et al., 2014. Where is the Land of Opportunity? The Geography of Intergenerational Mobility in the
United States. (Online Appendix Figure II Panel D).

These findings open up new possibilities for the use of the BHPS data. If income by
around age 30 provides a good enough approximation of lifetime child rank, with
little attenuation from within age group rank heterogeneity, then choosing age 28
as the lowest age at which to measure child incomes would appear reasonable
following the suggestive evidence from the US and Sweden cited. The next question
is, how many years of child income would we like to average over? As suggested by
Figure 2A above, rank measures do not appear significantly attenuated when single
year estimates are used. Therefore, we might consider using several samples that
average between 1 and 5 single year child ranks. With 21 BHPS waves available to
date, averaging over 5 annual rank estimates from age 28 would mean that the
youngest an eligible respondent observed in 1991 could be is 12. Working down, if
only one years worth of income data did provide a reasonably reliable estimate as
suggested, then children as young as 8 in 1991 could join the sample. We are of
course still limited by the fact that we cannot link parents and children who do not
live with one another in at least one wave. This means that we must restrict our
sample at the top to 18 year olds only as before. Tables 2A-6A below present
information on the sample sizes now available when these alternative sampling
restrictions are applied.
- 68 -

Table 2A: 8-18 (N = 2035)

Variable
aage

Obs

Mean Std. Dev.

Min

Max

2,035 12.93612 3.183637

18

Mean Std. Dev.

Min

Max

1,837 13.46815 2.884051

18

Mean Std. Dev.

Min

Max

1,651 13.97153 2.598328

10

18

Mean Std. Dev.

Min

Max

1,474 14.44844 2.332302

11

18

Mean Std. Dev.

Min

Max

1,263 15.02454 2.007166

12

18

Table 3A: 9-18 (N = 1837)

Variable
aage

Obs

Table 4A: 10-18 (N = 1651)

Variable
aage
.

Obs

Table 5A: 11-18 (N = 1474)

Variable
aage

Obs

Table 6A: 12-18 (N = 1263)

Variable
aage

Obs

Averaging over all these potential samples, the mean size is 1652; more than three
times larger than is available when standard log-log measures are deployed in Eq.
(1A). The reader may be concerned that unlike the approach taken by Chetty et al.,
who measure all children in their sample at the same age (around 30), my
- 69 -

specification includes individuals aged between 28 and 39 in the final wave. While
ranks do remain pretty much constant within age groups as shown in Figure 1A,
none of the evidence presented so far would indicate that the income of a 39 year
old should tend to place him/her within the same rank as their former selves at age
28 relative to the income of any other 28 year. Indeed, that incomes grow over the
lifecycle is the very essence of the HS model. How might we get around this? One
obvious answer would be to mimic the above cited work by observing all individuals
at the samples lowest observed adult age (i.e. 28). After adjusting the recorded
incomes of older respondents when aged 28 by the Consumer Price Index (CPI) so
that they may be ranked alongside those who fall within each samples selection
criteria in the final wave, and then inserting controls for the age at which an
individual and their parents entered the BHPS following the logic of Eq. (1A), we
would then estimate the model:
= + 1 + +

(2A)

The sampling method outlined above would be much the same for the averaged
samples (Tables 3A-6A), with the same age specific ranks averaged for all those
included. An exciting feature of this approach as it applies to the BHPS is that as time
goes on, our sample size will grow as more and more individuals become eligible for
inclusion, which contrasts sharply with the static NCDS and BCS cohorts. However,
the flaw inherent in this baseline method is that it wastes a lot of individual level
data. For instance, if the sample from Table 5A were used for analysis, all 1474
respondents would have only four years worth of income data included within the
rank regression, despite the fact that just 211 of these individuals are actually
limited to this amount of data. Indeed, those who were 18 in 1991 will have 11
potential data points to average over, which if used would surely make the resulting
elasticity estimates more reliable. One option might be to compute within age group
rankings for all individuals with excess data points. As none of the samples above
would otherwise consider incomes at ages 34-39, in each of these years those
individuals that do report information may be ranked, with these ranks then used
in the computation of their mean ranks for the purposes of Eq. (2A). The problem
with this approach is that the income distributions will be sensitive to the number
of respondents involved. This means that the resulting ranks from a small sub- 70 -

samples of individuals could differ significantly from both those ranks observed
when these are computed for the complete sample at earlier ages, as well as the
population distribution for that age. Indeed, with an average sample size of 1652 for
the complete sample, many may question how representative rankings will be of the
national income distribution. In an ideal world a researcher could make use of the
UKs rich national income data. The Office of National Statistics (ONS) annual
Survey of Personal Incomes provides yearly averages for incomes at each percentile
point of the national income distribution before and after tax. Using this
information, before tax income scores from the BHPS for all individual observations
at a single age (adjusted using the CPI as before) could be ranked within the national
income distribution at a particular year. The problem with calculating a national
rank is that the ONS only report the distribution of income by age range at the
median and mean of the income distribution.27 This means that percentile ranks
from the Survey of Personal Incomes pertain to the entire population of earners,
which limits our ability to compare the average ranks for individuals across
different ages. It is highly likely however that the reason such age specific percentile
ranks are not reported owes more to limited space within the ONSs data
publications than it does to data privacy, so it is highly likely that such information
could be procured.28 Linking data to national as opposed to local BHPS income
distributions would therefore allow a more accurate estimation of elasticity, with
age specific rank distributions normalised at the national level. In all samples, we
would therefore average over as many rank observations as possible for a given
individual. The number of years used to average all childrens ranks from the
baseline estimation in Eq. (2A) 1 to 5 will now represent the minimum number
of observations per individual in the regression model written in symbols below:

= +
1 + +

(3A)

Estimating Eq. (3A) in addition to the baseline regression model Eq. (2A) would thus
provide a good test for the robustness of this specification, and of the extent to
See data source: https://www.gov.uk/government/statistics/distribution-of-median-andmean-income-and-tax-by-age-range-and-gender-2010-to-2011
27

If such data were not available directly, researchers might consider experimenting with
parents ranked as a percentage of the median earnings within each age group.
28

- 71 -

which income variability and a potentially unrepresentative income distribution

obtained from the survey data itself may effect rank measurement.
Lastly, these analyses would aim to average over as many parental rank
observations as possible in both specifications. That said, although evidence
presented by Mazumder (2005) does show that estimates become attenuated
through classical measurement error with even five years of parental income data
averaged using log-log models, Chetty et al. again highlight (Figure 3A) how rankrank slopes can be largely unaffected by the number of yearly parent observations
included in an analysis. Moreover, the age at which parental income is measured
(Figure 4A) also displays a surprising lack of sensitivity. As before, this in no way
implies that one parents income measured at different ages would have the same
rank in a given period. Therefore, computing parent ranks will require that we also
consider ages that are common across the samples. Given the result in Figure 3A
however, this is not likely to affect our estimates.

Figure 4A: Varying the age which parental (mothers) income is measured and its effect on rank mobility. Source:
Chetty et al., 2014. Where is the Land of Opportunity? The Geography of Intergenerational Mobility in the
United States. (Online Appendix Figure II Panel B).

- 72 -

Figure 4A: Attenuation bias from number of years used to measure parent income. Source: Chetty et al., 2014.
Where is the Land of Opportunity? The Geography of Intergenerational Mobility in the United States. (Figure
III Panel B, p86).

In conclusion, although rank measures of mobility do ultimately provide less

information than log-log measures (with these also accounting for the marginal
distribution of incomes, not only the copula), the robustness of rank-rank IGE
estimates to various forms of bias mean that the results obtainable from the analysis
outlined here would likely represent one of the most reliable estimates of
intergenerational dependence from any UK source, particularly given the putative
concerns raised in the text regarding the recent analysis of Gregg et al. (2014).

- 73 -

APPENDIX B: AN ALTERNATIVE INDEX OF MOBILITY USING TRANSITION

MATRICES
Here I present a simple alternative index measure for the study of intergenerational
dependence through transition matrices the Relative Absolute Disadvantage
(RAD) Ratio which focusses on the corner cells of a matrix. First however, it is
important to highlight the strengths and weaknesses of other popular measures,
namely the Bartholomew index. This measure expresses mobility in terms of the
average income boundaries crossed over the observation period. The Bartholomew
index simply sums up the moves across income classes, i.e. outside of the main
diagonal:

1
=
| |

=1 =1

Here represents the proportion of children in income class j having parents in

the income class i. In the case of no mobility the, the Bartholomew index will thus
take value zero. If mobility is high, then irrespective of whether movements are
upward are downward, the proportion in a given cell times the absolute value of
| | will be higher the further the distance travelled across the distribution by an
individual relative to their parents. To fix ideas, consider the cross country
transition matrix of Eberharter (2013) presented here in Table 1B.

- 74 -

Table 1B: Cross National Mobility in Income Positions. Source: Eberharter, V. V., 2013. The
Intergenerational Dynamics of Social Inequality Empirical Evidence from Europe and the United
States. SSRN Electronic Journal. (p27).

The first score in the Bartholomew index for parents in income position 1 in
Germany is 1.3313. The scores from each parent position are then added up and
divided by the number of positions (five in a quintile matrix). This gives an index
score of 1.1828 for Germany (the most mobile country), 1.252 for the US and 1.1189
for Britain (the least mobile country). Several difficulties emerge from this measure.
First it is not easily interpretable, with the resultant B from equation above
representing a fairly non-intuitive summary statistic. Second, we may not care all
too much about the upward or downward mobility of children from parents in the
middle of the income distribution. Looking at the corner values only, we can see that
while Britain shows the greatest amount of stickiness for children born to parents
in income class 1 (a finding which mirrors the J shaped relationship described by
Gregg et al., 2015), children born to parents in income class 5 in both the US and
Germany are more likely to remain in this elite bracket than in Britain; that is, less
downward mobility. Indeed, if we look at the transition proportions in cell [5, 1] for
each country, fewer children in the US fall into the bottom income class when born
at the top than in Britain and Germany. In the language of Raitano and Vona (2015),
this is a parachute effect which we may which to take greater account of.
- 75 -

The measure proposed here is built from a simple risk ratio (RR) of the type used in
clinical testing:
=

/( + )
/( + )

where () and () may be thought of as the chance of an event occurring (not

occurring) in the treatment and control respectively. An RR value of 1 will thus
indicate that the estimated effects are the same in both interventions. In the present
context, I wish to consider the relationship between growing up poor and
subsequently being at the bottom in adulthood. The treatment may therefore be
thought of as growing up in a poor household, with denoting the proportion of
those who are born poor and stay poor (denoted PP). Here the subscript letter
denotes the parents status. The control represents those who are born rich and
become poor (denoted PR). Concentrating on immobility at the very bottom and
very top may seem arbitrary in the sense that high mobility out of income class 1
(5) and into income class 2 (4) might not be seen as particularly egalitarian, as these
children still lie below (above) the median. Therefore, my index will consider the
adult outcomes of children comfortably below and above the middle of the income
distribution; that is, at or below (above) the 40th (60th) percentile. Denoting each
quintile by (subscript for the parents quintile and superscript for the childs
quintile), the RR can now be written as:
1

1 + 1 / 1 + 1 + 1 + 1
1

5 +5 / 5 +5 + 5 +5

If we calculate this figure for Britain the numerator takes value 0.8, which implies
that children born to parents in the bottom quintile have an 80% chance of
remaining below the median. The denominator takes on value 0.25, implying that
those born at the top have just a 25% risk of falling below the median. The ratio of
these figures is 3.2, implying that those born in the bottom quintile are over three
times more at risk of staying below the median than those born to parents in the top
quintile. A standard variant of the RR is to calculate the effect size of an intervention,

- 76 -

which in drug testing is referred to as ARR (absolute risk reduction)(BMJ 2012).29

In the present context, this would take the form of the treatment risk minus the
control risk (numerator minus the denominator in the RR), which tells us the
absolute risk disadvantage (ARD) faced by poor children. Using the same notation as
above, this ARD will take the form:
2
1
2
4
5
1
2
1
2
4
5
= (1
1 + 1 / 1 + 1 + 1 + 1 ) (5 +5 / 5 +5 + 5 +5 )

The ARD score for Britain will now be 0.55. This figure can be thought of as the
residual risk of poor economic status that comes with growing up poor. Unlike RRs,
this absolute figure can easily be used to compare the size of the risk disadvantage
faced by the poorest families between two countries or two time periods within the
same country.30 One way to compare the size of disadvantage would be to take the
ratio of the country level ADRs, which would tell us the relative absolute
disadvantage (RAD) shown below:
1

RAD =

(1 +1 / 1 +1 + 1 +1 )1 (5 +5 / 5 +5 + 5 +5 )1
1
2
1
2
4
5
1
2
1
2
4
5
(1 +1 / 1 +1 + 1 +1 )2 (5 +5 / 5 +5 + 5 +5 )2

) = (2 )

All of the terms in the RAD ratio are indexed by the country to which the transition
proportions pertain; 1 and 2 . If RAD equals 1, the absolute mobility disadvantage
experienced by the children of low income parents in one country equals the
mobility disadvantage experienced by the children in another. The size of one
countrys ARD may be driven by high persistence at either end of the income
spectrum, meaning that a relatively high intergenerational dependence within
poorer families may be counterbalanced by a relatively low intergenerational
persistence in higher income families, with the latter increasing the size of the
To avoid confusion, note the ARR is phrased positively in terms of the reduction of risk
because the treatment is typically aimed at alleviating the harm. In this analysis, the treatment
is expected to perpetuate the harm. In standard ARR formations, the score is calculated by
subtracting the absolute risk in the treatment category from the absolute risk in the control
category (ARR = ARC ART). Hence, my variant ARR figure reverses this order so that the risk
in control is subtracted from the risk in treatment, making ARR the absolute risk disadvantage
(ARD = ART - ARC).
30 While we may wish to juxtapose one countrys RR or ARD figure against anothers, an accurate
measure of the difference in size will require a ratio. Using a RR for this purpose would be
clumsy, as the resulting figure would have to be interpreted as a ratio of ratios.
29

- 77 -

numerator in the second term. To see how the results from these alternative
measures compare with those from the Bartholomew index above, Table 2B
presents calculations for each countrys ARD (column 3), followed by the between
country RAD ratios (column 4).

Table 2B: Comparative Measures of IGM using Transition Matrices

Country
Germany (GER)

Great Britain (GB)

United States (US)

ARD

1.1828

0.51

1.1189

1.1252

0.55

0.64

RAD ( , )
GB =

US =

0.92

0.80

GER =

US =

1.08

0.86

GB =

GER =

1.16

1.25

Looking at the results, the residual disadvantage in the US is significantly greater

than in Britain, reversing the order displayed by the Bartholomew index (labelled B
column 2). Encouragingly, the new figures are now consistent with the ranking of
the authors IGE estimates derived from the same sample data.31 The US result is
mainly driven by the relatively low value of the second term in its ARD measure
(0.15), which implies just a 15% risk of falling below the median for those born at
the top, which is around 30% less than the score for Germany (0.21). While the
difference between the B values is nominally very low, using the RAD ratio shows
that the US residual disadvantage is 16% higher than in Britain, and 25% greater
than in Germany. While the Bartholomew index does offer a more complete picture
of the total amount of mobility within a society, the RAD ratio provides us with an
intuitive measure which may accord more with peoples perception of fairness in
outcomes.

Under the authors baseline specification (presented in row 1, Table 3 above), elasticities for
the US, Britain and Germany equal 0.678, 0.504 and 0.484 respectively.
31

- 78 -

APPENDIX C: DE-IDENTIFIED SURVEY RETURN (ATKINSON, MAYNARD AND

TRINDER)

- 79 -

ROI.INTREIi-I,AVERS FOLI,OI.J-UP STUDY

I'I,AIN STIRVEY 1976

N.\}IE

195O Code

ADDIiIiSS

1976

Name

Interview

Number

of InEerviewer

Dace(s), Times(s) and Length(s) of Interview(s

Form of Introduction

.... We serit you a letter to say thaE we were visiting the

I 1m
childr:en of the people rvho took Part in the 1950 Rowntree Survey and that I
would be calling on you. Itd be very grateful if you could help me by answering
a .iew simple ques;tions aI -ut yourself ancl your family.
,,Hello.

LAY-OUT OIT INTERVIEW

![!1'I9N '/"

gqyjItt0lD S.Cffi
(one scheclule for each household)

rNllv?ml sqFgffi
(one sc.heclule f or each person
ed rrca E ion)
sEC'fIoN 'B'
SI'-C'IIOI{

'C'

F<;r:

those noE retirecl

For chose who have retired

ag,ed

15 or over and not in full*time

2.
stiltlt^R\
C()IIt)LI':'tli"\ETER INTERVIEII
Code

[.

Intcrview carried out

ar firsr call
at second call
at third or later call

2
3

in fo rmation

te
'i.'ncompletg
comp 1e

(a) If incompleEe, what information is missing:

Earnings

Other income
Orher informaLion

(PLEASE

SPiiCIFI:

(tr) If incompl.ere,

c) lf

e;r rrt

j-ngs

inc:omp1et.e,

.SPECIFY

REASONS

or o Lher hcome i rrf ormatiorr

is:r return visit likely to

y'ie I.cl f urLlrer inf ormation?

Yes
No
Dc.r

'rr

l) t.

rr

l.

tr r:

c.

r-lmmttd a

not

know

t i on

I)eLachcd house or bungerlow

Serrni-detached house or bungalow

Terraced house
Sr:1,[-conLained flat in bLock
Scl [.-cr,rntained f lat in house
l.'rr rn j :; Ircd rt-rr.irn:;
r\{ i,,,r

r(:l)1.'I' I :.'/l

1
2

o
4
5

6
7

Ritf L:ilb

lc

V.t Lue

N()'t' I.'('IR TN'tI.]RVTIiWER TO Ir tt,l- iN)

ttlhich sC tit)lls were atlswered by

which persorts in the h.rusehold?
Seccir:n A
Section B
Seetion C
(YOU I'IAY CIRCLE I'IORI 'THA.\
PERSON FOR EACH

OF

A, B,

Letters on Plge Al of
l{orrsetro l.i Scheclule
@t , u v t{ x Y z

@truvlixYZ

RSTUVWXYZ

ONE

C)

Enter trousehold composition code

(SEE INSTRUCTION MA}{UAL _ IF
ROI.iNTPGE SON/DAUGHTER NOT REU'TED

TO HEAD OF HOUSEI{OLD, ENTER O)

Enter commenrs by respondents (if any) and interviewerts general obserwations.

Ttre laEEer may cover degree of interest shor,rn, willingness to provide informaric
apparenE accuracy of responses, and any other information thoughE relevan' I t't
whereaborrts of brother:s or sisters or 195o respon<lents and general picture of
Iifecycle 6istory of che Rowntree dependent ancl his wife (her husband) if marrit

c()li't' I r;1I.. ():,,i l.lli

i;'l

lEgrr0\A
HOUSEHOLD SCHEDULE

FA}TILY AND ACCOMMODATION

ASK ALL QUESTIONS TO HUSBAND OR WIFE OF

ALL FAMILIES EXCEPT WHERE SPECIFIED

OTHERI{ISE.

rpENrr l'rcATroN clrFCI(

A.1 First of all can we just check that it was your husbandts/
wifes t s parenEs who took part in the 195O Rowntree Survey
(PGAD OUR NAME(S) AND ADDRESS OF 1950 RESPONDENT)

G.

Yes
No

1950

(ENTER

RESPONDENTTS

NAIfi AND ADDRBSS BEEORB Do not know

TNTERVIEI{)

(IF

ANSWEII

tl

IS 1 OR 3 PROCEED T,IITH INTERVIET,I) - IF 2 TICK

and SPECIIY

A.2

How old
.(ENTIIR

years

would your father have been Ehen?

ROWNTREE'S ANSWER .

DO NOT ASK

HOUSEHOLI)

IF

.:.

NO LONGER ALIVE

Dontt

BEFORE INTERVIEW,

know

IN 1950).

CO}IPOSITION

Couid we now ask about your present family?

.3

Fu1.l. names and relationship to

son or datrghEer

Person
Code

Ruwntree son oae--t@r

Fu11 name

Spouse

of

Age

Rovrntree

(DELETE ONE)

Rourntree son a*.4aug&+er

ll

ll

I,

r-r

i'

:r

f,er

Ite

la t ives

l-ilIress

7.

iI

r-

r-l

t ; ,r

,i
".(

ar-rd

children
only)

Marital

Status

;@tr,lDsep.

no

Gt "

D sep.

Mc

*O,

D sep.

@r

MSWDSep.

I,1 F

ll

MF

M S W D Sep.

t.{

MS

S W D Sep.

Ttris

K----Fli
-Y

@n

tt

Ftrll name

Sex

(R

tt

I^I

D Sep.

MF

MSWDSep.

MF

M S t{ D Sep.

A.4.

Is Ehere anyone else who lives here with

you (e.g. lodgers)?

Yes

No

(a)

A.5.
t

ASK (a)

If yes, please provide details

children living ar an
adclress other than Lhis'one (including
children away as students) ?

Have you'any

Yes

No

(a) If yes. Please could you

tell us where?
(If husband or wifers child

ASK (a)

NA}IE AND qXACT ADDRESS

1.
bY

anoEher marriage please specifY

de

raits

2.

below)

3.

.6. It{ I IIRV tDirrER:

IF

ROWNTREE SON/DAUG}ITER

IS LODGER

IN TIOUSEIIOLD I,JI{ERE HEAD IS

NOT

RILATTVE, TICK AND GO TO Q A.lO(d)

rl

ACCOMMODATION

And now

a fetr questions about your

home?
CODE

How many

roons are there for Lhe sole

of your household?
(a) living rooms
(b) bedrooms

use

number
number

Do you have?

(a) a separaEe kitchen and is that

large enough ro eat in?
Yes, large enough
Yes, not large enough
No.

(b) a bathroom
Yes, sore use
Yes, shared
No

(if more than one Put number

here
)
(c) an indoor

WC

Yes, sole use

Yes, shared
No

(if more than

here
(d) an outdoor

one Put number

)

WC

Yes, sole use

Yes, shared
No

Who

(a)

is the householder?
Do youlhe/she own or rent this
house/ f 1at?
Own

fullY Paid

Ovrn on morEgage

6l

ASK (c)

ASK

(c) and (d)

RenE from council

Rent PrivatelY
Renr. free
Housing association
0 ther

ASK (b)

1l
6
7

(b) If rented, is ic
Furnished
Unfurnished

(c) If own, have you :rny idea of the present

markeL value of the house/f1at?
Value

Dontt Know
(d) If orm on morrgage' have you any idea

of the size of

Ehe ouEstanding

morLgage? (PR0MPT: E.G. half value of houiel)

Amount
Dont

.10.

Xnow

you pay (before rebates) in

eiEher mortgage rePalrmenEs*

What clo

or rent (not including rates)

and rates (including lrater

E per week

If rented, do You get a rent

Yes

_-+
L AsK

rebate?

No

raLe s )

(a)

(i) If yes. How much is it?

(ii1 So on rent you pay (after
(b)

f, per week
f. pef week

E,

per week

f, per

rebate) ?
Do you get a rate rebate?

(i) and (ii)

week

Yes

ASK

(i) and (ii)

ASK

(i)

No

(c)

(i) If yes. How much is it?

(ii) So on rates you pay
(after rebate)?
Do you let or sub-let anY
rooms

f, per

week

E per week
Yes

No

(i) If yes.

How much

rent

do

you receive?
(d)

ASK LODGERS
How much

per

ONLY

do you pay for lodging

[. per

week?

Does

E per week

rhis

inc&ude board?

week

Yes
No

Il.iCLiri)ii I-OAI{ INTIiR.EST AND END0';${ENT II'ISURANCE PREMIA ITIIIERE APPROPRIATII.

FAMILY BENEFITS
ASK FOR FAHILIES WITH CHILDREN' oTHERI.ITSE GO TO Q.A.15.

4.11.

receive fanilY allowance?*

Do You

1.""

Qot*

(a)

,)

No

(a) lf yes, how much?

A.

Do you

t2

E per

receive FamilY Income

week

SuPPlement?

1 AsK (a)

Yes

(EKqT.AIN)

(r\
E,,

No

(a)

If yes,

how much?

E per week

of your children stay aE school

Yes
for dinner?

A. 13. Do any

'

O** (a)
2

No

(a) If yes, do anY of

Ehem

receive their

Yes

dinner free?

rrumber

No

Do you reeeive an educational maintenance

granr?

(EXPLAIN)

Yes
No

(a) If yes, hov

l:'.
ASK

ALL

l5 .

much?

1 ASK (a)

f, per year

HOUSEIiOLDS

lloes any member

of this househotd recei've:

Free prescriptions

l'ree glas ses

Yes
No

Yes

No

I.'rr,:e

dental

tr:eatmen

Yes
No

IIi(]I,Ui)IIiC CTIlLD INTtrRIll BITNEFIT FOR SII'IGLTi PARJINT !'AHILIES

e
G
2

'

MISCELLANEOUS

.16

ASK SPOUSE

(if

OF ROSINTREE SON/DAUGHTER

pos s ib 1e)

(a)
(b)

l,Ihat is/was you f aEher t s main

occupation?.
In what industry does/did he
work?

Qasr

ta)

No

(a) Are rhe vegeLables you

eaE home
A11

grown?

;1

Most
Some

A few

None
How much woutd

you say this

saves you each

week?

asK (b)

i per week

(a)

Do you have cenEral heating?

Yes
No

(b)

Do you have

telePhone?

Yes
No

(c)
(d)

Do you have ;r
Do you have

refrigerator?
car?

If yes.

No

Yes

How manY?

approximat,e value(s) of car ( s)

SPECIFY

N[jMBER

(ii)

Yes

No

(i)

ASK

(i) and (ii)

INqIVIDUAL

SECTION

BI.

SCHEDULE

EHPLoTNI.
(One schedule

educat,ion.)
for each person aged 16 and over and not io full-tine

cuRRENr EqtoYMENT

Could

JrI

Al'lY)

some quesEions abouE your work?

I begin with

First of all, were you aE work full-Eime

(30 hours or more) lasE week?
Yes
Why were you

not in fulI-time

work?

HolidaY
Sick
UnemPloYed

Short-Eime

Uarried

'

and (c)

2 ASK (a)

No

(a)

Q esr ttl

\Jorrarr

ReEired

Other
(SPecifY)

1 AsK (b). and (c)2 co To Q 8.7

3 Go To Q s.a
and (c)
4 ASK
8.9
5 GO TO
6 GO TO SCHEDI'LE C

(b)

(b) t'Iould you mind giving us some deEaiLs of

OccuPation
vour iob?
IndustrY
EmPloYer

TrcK

SELF-EHPLOYEI),

(c)

BOX AND GO TO Q

Do you have

8'6

a second, part-time job?

Yes (give details)
No

ASK Q.

8.2

8.2 - B.5

WITH RESPBCT TO MAIN JOB

(a) What are Your basic hours* Per week

Hours Per
your main job?
(b) WhaE

is your basic taLe of

PaY?

(BEIIORE DEDUCTIONS)

(c) Are you on an incremenEal salary scale?

Yes
No

(i)

Whar

is

Ehe EoP

of the

scale?

iJA:JIC }{OUITS Uii!'tNIiD TO EXCLUDTi },IEAL BITLAKS AND OVIIRTIM]i.

hours
COUPLETE ONE

Per week Per month Per Year

- E-.. t..
E
1 ASK

(i)

(^
\:-/

Per week Per month Per Year

f........

E......--

t.......

.3(a)

How many

ho,rrst did you work lasr week (in

hours

Hours
your main job)?
(i) tlas chis affected by short-rime?
h$lhr.fs \6qS. ttB ug.l8.
Yes

No

(b) l^Ihat were your gross earnings lasr week/

.monrh/year

(c)

How much

in Your main job) ?

(CoMPLETE ONE)

Week Month

Year

f,...,

f......

was deducEed for:

Income tax

N.I. Contributions
EmploYers t suPeranrluation
(d)

So

that your total

take-home pay

INTERVIEI{ER: TICK IF. PAYSLIP

was

SEEN

Week/Mbnth/Year

FRESPONDENTRELUCTANT,SHOWFI.ASHCARDA}IDINSERT

Net/Gross

NI,J}IBER. INDICATE NET OR GROSS

B.4. Does your iross PaY varY

much?

from week-Eo-week

Yes
No

From month

to

month Yes
No

(a) If yes, specify details and normat range of

variations in gross earnings
TICK BOX IF SEASONAL WORKER
cosEs are associated wirh
your main job? (PROMPT: cosr of travel,
Details
books, eEc.)

(a) What

(b)

o
o

ASK (a)

AsK (a)

From

toE

financial

fringe benefits do You receive?

(PR0l'tPT: goods at discount, company car, etc.
GO TO Q.B. ll
What

INCI,UDE OVERTIME BUT IiXCI,UDE I'{EAL BREAKS

E per week/month
f, per week/month

87

SOURCES
INCO}IE FRO}I OTHER
'I

ASK ALL

3.11,

Have

you a part-time job?

Yes'

If yesr

may

.I2..

OTHER

.. . . hotlt,

Hours
Pay

(x

(a)

I ask details of your hours,

pay and deducrions.

ttor NOt{(a ft<

ASK

No

(a)

Deductions

nct}uaNr(

E .......

I .......

Per week
per week

INCOME
.

(a)

rF

from interesE
or dividends do You receive from: (i) Post office Savings

How much i.ncome

|NONE'
NONE, WRIIE

f,

(ii) Building societY

(iii) Bank dePosir
(iv) Other (stocks and shares,
etc.)
(b) Do you pay inEerest to the bank? If yes

E
E

how rnuch?

(c)

Do you

Per

per

receive anY income from

(i) rent on Property

(ii)
arrnuiEy or occupational pension
(iii)
other sources (SPECIFY)
(PROI,IPT: gif ts, court order, trade union benef its, etc ' )
.13.

your toLal annual income comes before

within which of the following ranges
So

(sHot,I TT.ASHCARD) ?

per

t,

per
per

f,

Lax

Range

(A,BrCrD.or E)

tl

B8
EPUCATION

ASK ALL

(a)

of school or college did you lasE

attend ful1-tin3?
Primary or ElemenEary school (incl' Central/
-''
Inte-rmediate/Higher Grade/A1l-age/Board)
SecondarY llodern .,...
'; " '
Comprehensive school (incl' Sixth Form College)
..".."
Gramar
""'
Direct GranE or Independent school '''"...."""'
""I'"'
Technical school-

What type

of Bducation (Teacher Training College) in

."""""""
""'
UK
.....
University in
''"'
CoI]-ege
UK ..

other Coll-ege or university (sruclI.y)

How

old were

o
3
4
5
6
7

Other . school (SPECIFY)

(b)

You when You lef L schoot ,or college?

Age

(c)

Were there any breaks in your

Please specifY.
experience?

(d)

How many GCE

or

full-time education

CSE examinations have you passed?

CS[
GCE

o Level

GCE

rF NONE, WRrrE

Level

(NOTE CSE STARTBD 1965)

(c)

Have you comPleted a recognised trade apprenticeshiP?

Yes
No

(i)
(d)

AsK

(i)

ASK

(i)

If Yes, sPecifY deLails

Have you a universirY degree?

Yes
No

(i)

lf yes, s1>ecifY details'

'TNONE'

PAST

EI'TPLOYMENT

8.15.

I now ask some quesEions about your

work hisLory? How long have you worked
for your present (last) emPloYer?
May

AS T'AR AS POSSIBLE

COMPLETE

L975

r974
PROMPT:

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L974 3 day week and General Elections

1970 General Election
1966 England won the World CuP

L972

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you in fu].L-time work in 1966?

Yes

1968

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i.

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8.16.

a l

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1970

i. a .

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No

(a)
(b)

B.

1_7

per

IIow much was your gross pay then?

Who

were you working for?

Have you records

in different

of your

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pasE earnlngs

years?

Yes
No

(a)

If yes, can we note

de tails?

week

some

1 ASK (a)

of the

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810

II. 18.

spells, if any, have you experienced

of sickness or unemployment in Ehe past

What

T.IRITE INONE'

ten years?
Sickness (3 months or more)
a a.

UnempLoyment

(of any length)

a a a a .

a a:a

IT

NONN