Intergenerational Income Mobility and Family Dissolution

Abstract

This study examines the intergenerational income mobility between intact families and families disrupted due to divorce or parental death. The data samples consist of children born in 1960 and 1970 along with their biological fathers and mothers. The income mobility is explored between sons and fathers, sons and mothers, daughters and fathers and daughters and mothers. The results of the analyses show that the income mobility differs between intact and disrupted families where the deviations and magnitude are dependent upon the child-parent mobility pair. The offspring in disrupted families seem to be socioeconomic disadvantaged relatively to offspring in intact families, regardless of type of disruption, something that can be explained by differences in transmission of human capital between generations. Finally, the study investigates whether the results are due to causal effects or a consequence of selection, using a difference-in-difference model. The results do not unconditionally support the causal effect interpretation, but there are too many weaknesses attached to the data samples to conclude on this matter.