IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/2282.html
   My bibliography  Save this paper

The Effect of Family Background on Economic Status: A Longitudinal Analysis of Sibling Correlations

Author

Listed:
  • Gary Solon
  • Mary Corcoran
  • Roger H. Gordon
  • Deborah Laren

Abstract

Numerous previous studies have used sibling correlations to measure the importance of family background as a determinant of economic status. These studies. however. have been biased by several flaws: failure to separate permanent from transitory status variation (including that from measurement error). failure to account for life-cycle stage. and overly homogeneous samples. This paper presents a methodology to address these problems and applies it to longitudinal data from the Panel Study of Income Dynamics. Our main conclusion is that family background appears to exert greater influence on economic status than has been indicated by earlier research.

Suggested Citation

  • Gary Solon & Mary Corcoran & Roger H. Gordon & Deborah Laren, 1987. "The Effect of Family Background on Economic Status: A Longitudinal Analysis of Sibling Correlations," NBER Working Papers 2282, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:2282
    Note: LS
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w2282.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Becker, Gary S & Tomes, Nigel, 1976. "Child Endowments and the Quantity and Quality of Children," Journal of Political Economy, University of Chicago Press, vol. 84(4), pages 143-162, August.
    2. Gary Solon, 1983. "Estimating Autocorrelations in Fixed-Effects Models," Working Papers 540, Princeton University, Department of Economics, Industrial Relations Section..
    3. Abowd, John M & Card, David, 1989. "On the Covariance Structure of Earnings and Hours Changes," Econometrica, Econometric Society, vol. 57(2), pages 411-445, March.
    4. Corcoran, Mary & Jencks, Christopher & Olneck, Michael, 1976. "The Effects of Family Background on Earnings," American Economic Review, American Economic Association, vol. 66(2), pages 430-435, May.
    5. Griliches, Zvi, 1979. "Sibling Models and Data in Economics: Beginnings of a Survey," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 37-64, October.
    6. MaCurdy, Thomas E., 1982. "The use of time series processes to model the error structure of earnings in a longitudinal data analysis," Journal of Econometrics, Elsevier, vol. 18(1), pages 83-114, January.
    7. MacDonald, Glenn M & Robinson, Chris, 1985. "Cautionary Tails about Arbitrary Deletion of Observations; or, Throwing the Variance Out with the Bathwater," Journal of Labor Economics, University of Chicago Press, vol. 3(2), pages 124-152, April.
    8. Manski, Charles F & Lerman, Steven R, 1977. "The Estimation of Choice Probabilities from Choice Based Samples," Econometrica, Econometric Society, vol. 45(8), pages 1977-1988, November.
    9. Kearl, J R & Pope, Clayne L, 1986. "Unobservable Family and Individual Contributions to the Distributionsof Income and Wealth," Journal of Labor Economics, University of Chicago Press, vol. 4(3), pages 48-79, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Joseph G. Altonji & Thomas A. Dunn, 1991. "Relationships Among the Family Incomes and Labor Market Outcomes of Relatives," NBER Working Papers 3724, National Bureau of Economic Research, Inc.
    2. Gary Solon & Mary Corcoran & Roger Gordon & Deborah Laren, 1988. "Sibling and Intergenerational Correlations in Welfare Program Participation," Journal of Human Resources, University of Wisconsin Press, vol. 23(3), pages 388-396.
    3. Blaess, Virginie, 2005. "Siblings and Educational Attainment in West Germany," Discussion Papers 2005,001E, University of Erfurt, Faculty of Economics, Law and Social Sciences.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Charles Grant & Christos Koulovatianos & Alexander Michaelides & Mario Padula, 2010. "Evidence on the Insurance Effect of Redistributive Taxation," The Review of Economics and Statistics, MIT Press, vol. 92(4), pages 965-973, November.
    2. Fatih Guvenen & Burhanettin Kuruscu, 2010. "A Quantitative Analysis of the Evolution of the US Wage Distribution, 1970–2000," NBER Chapters, in: NBER Macroeconomics Annual 2009, Volume 24, pages 227-276, National Bureau of Economic Research, Inc.
    3. Bartzsch Nikolaus, 2008. "Precautionary Saving and Income Uncertainty in Germany – New Evidence from Microdata," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 228(1), pages 5-24, February.
    4. Tony Smith & M. Fatih Guvenen, 2007. "Inferring Labor Income Risk from Economic Choices: An Indirect Inference Approach," 2007 Meeting Papers 1024, Society for Economic Dynamics.
    5. Alvarez, Javier & Arellano, Manuel, 2022. "Robust likelihood estimation of dynamic panel data models," Journal of Econometrics, Elsevier, vol. 226(1), pages 21-61.
    6. repec:spo:wpecon:info:hdl:2441/6ggbvnr6munghes9od0s108ro is not listed on IDEAS
    7. Dmytro Hryshko, 2012. "Labor income profiles are not heterogeneous: Evidence from income growth rates," Quantitative Economics, Econometric Society, vol. 3(2), pages 177-209, July.
    8. In Choi, 2019. "Unit Root Tests for Dependent Micropanels," The Japanese Economic Review, Springer, vol. 70(2), pages 145-167, June.
    9. Michael Haliassos & Alexander Michaelides, 2003. "Portfolio Choice and Liquidity Constraints," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 44(1), pages 143-177, February.
    10. Burkhauser, Richard V & Holtz-Eakin, Douglas & Rhody, Stephen E, 1997. "Labor Earnings Mobility and Inequality in the United States and Germany during the Growth Years of the 1980s," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 38(4), pages 775-794, November.
    11. Biewen Martin, 2005. "The Covariance Structure of East and West German Incomes and its Implications for the Persistence of Poverty and Inequality," German Economic Review, De Gruyter, vol. 6(4), pages 445-469, December.
    12. Thomas J. Kniesner & W. Kip Viscusi & Christopher Woock & James P. Ziliak, 2006. "Pinning Down the Value of Statistical Life," Center for Policy Research Working Papers 85, Center for Policy Research, Maxwell School, Syracuse University.
    13. Nao Sudo & Michio Suzuki & Tomoaki Yamada, 2012. "Inequalities in Japanese Economy during the Lost Decades," CIRJE F-Series CIRJE-F-856, CIRJE, Faculty of Economics, University of Tokyo.
    14. Amélie Adeline & Ismaël Choinière Crèvecoeur & Raquel Fonseca & Pierre-Carl Michaud, 2019. "Income Volatility, Health and Well-Being," Cahiers de recherche / Working Papers 1906, Chaire de recherche sur les enjeux économiques intergénérationnels / Research Chair in Intergenerational Economics.
    15. Chamberlain, Gary, 2000. "Econometrics and decision theory," Journal of Econometrics, Elsevier, vol. 95(2), pages 255-283, April.
    16. Joseph G. Altonji & Anthony A. Smith Jr. & Ivan Vidangos, 2013. "Modeling Earnings Dynamics," Econometrica, Econometric Society, vol. 81(4), pages 1395-1454, July.
    17. Kjetil Storesletten & Chris Telmer & Amir Yaron, 2007. "Asset Pricing with Idiosyncratic Risk and Overlapping Generations," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 10(4), pages 519-548, October.
    18. Estelle Dauchy & Francisco Navarro-Sanchez & Nathan Seegert, 2021. "Taxation and Inequality: Active and Passive Channels," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 42, pages 156-177, October.
    19. Richard Blundell & Hamish Low & Ian Preston, 2013. "Decomposing changes in income risk using consumption data," Quantitative Economics, Econometric Society, vol. 4(1), pages 1-37, March.
    20. Meghir, Costas & Pistaferri, Luigi, 2011. "Earnings, Consumption and Life Cycle Choices," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 9, pages 773-854, Elsevier.
    21. Blundell, Richard & Preston, Ian & Pistaferri, Luigi, 2002. "Partial Insurance, Information, and Consumption Dynamics," CEPR Discussion Papers 3666, C.E.P.R. Discussion Papers.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:2282. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.