Scandinavian Working Papers in Economics

Research Papers in Economics,
Stockholm University, Department of Economics

No 2006:2: Intergenerational Mobility, Human Capital Transmission and the Earnings of Second-Generation Immigrants in Sweden

Mats Hammarstedt () and Mårten Palme ()
Additional contact information
Mats Hammarstedt: Department of Economics, Växjö University, Postal: Department of Economics , Växjö University , SE-351 95 Växjö , Sweden
Mårten Palme: Dept. of Economics, Stockholm University, Postal: Department of Economics, Stockholm University, S-106 91 Stockholm, Sweden

Abstract: We compare the intergenerational earnings mobility of immigrants with natives in Sweden. We find an overall convergence in average earnings between immigrants and natives. This convergence hides a divergence in average earnings between groups of immigrants with different ethnic origins. We find that, on average, immigrants have a lower intergenerational earnings mobility, also (on average) within groups with similar ethnic backgrounds. Immigrants with a relatively low intergenerational earnings mobility increased their average earnings more in the second generation, thereby supporting the idea that low intergenerational earnings mobility can be interpreted as a high degree of intergenerational transmission of human capital.

Keywords: intergenerational income mobility; intergenerational earnings correlation; Becker-Tomes model; ethnic capital

JEL-codes: J15; J24; J61; J62

30 pages, February 24, 2006

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