Scandinavian Working Papers in Economics

Working Paper Series,
Research Institute of Industrial Economics

No 538: Redistribution, Occupational Choice and Intergenerational Mobility: Does Wage Equality Nail the Cobbler to His Last?

Anna Sjögren ()
Additional contact information
Anna Sjögren: The Research Institute of Industrial Economics, Postal: P.O. Box 55665, SE-102 15 Stockholm, Sweden

Abstract: The classical Roy-model of selection on the labor market is extended in order to analyze intergenerational mobility. This is done by linking ability uncertainty to family background. I derive implications for the allocation of talent and for background dependent earnings patterns within occupations and show that a very compressed wage structure can cause negative sorting of people with family background in the occupation with low returns to ability. I also study the effects of income redistribution on mobility and talent allocation. It is found that a redistributive welfare system either reduces vertical mobility or enhances it at the cost of a shrinking proportion of people choosing the occupation with high returns.

Keywords: Intergenerational mobility; Occupational choice; Allocation of talent; redistribution

JEL-codes: J62; J68

33 pages, June 6, 2000

Full text files 

iuiwop0538.pdf PDF-file Full text

Download statistics

Questions (including download problems) about the papers in this series should be directed to Elisabeth Gustafsson ()
Report other problems with accessing this service to Sune Karlsson ().

RePEc:hhs:iuiwop:0538This page generated on 2024-09-13 22:15:48.