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Family background and intergenerational mobility in a transition economy: Evidence from China

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  • Yan, Weibo
  • Gao, Sihan

Abstract

This paper develops a parsimonious model of incomplete credit and job markets in which family background helps children invest in education and land jobs. As some competent children lacking in social connections are shut out of good jobs, both their incentives and accessibility in investing in education reduce. The transition process to value more on education rather than family background is associated with higher relative mobility, upward mobility, and mobility expectations. To promote intergenerational mobility in developing countries, the reformation of the job market may be another key area besides providing more education opportunities for deprived children. Some evidence from China supports the theoretical model.

Suggested Citation

  • Yan, Weibo & Gao, Sihan, 2024. "Family background and intergenerational mobility in a transition economy: Evidence from China," Journal of Asian Economics, Elsevier, vol. 92(C).
    • Handle: RePEc:eee:asieco:v:92:y:2024:i:c:s1049007824000150
    DOI: 10.1016/j.asieco.2024.101720
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    More about this item

    Keywords

    Intergenerational mobility; Transition economy; Family background;
    All these keywords.

    JEL classification:

    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification
    • D52 - Microeconomics - - General Equilibrium and Disequilibrium - - - Incomplete Markets
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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