Intergenerational Mobility in Britain

This paper provides the first full account of intergenerational mobility in Britain using the British Household Panel Survey (BHPS) for the period 1991-1999. The estimates obtained from a sample of all adults who provide information on their parents’ occupation when they were aged 14 point to an intergenerational elasticity – measured in terms of Hope-Goldthorpe scores of occupational prestige – of the order of 0.15 to 0.30. After adjusting for possible measurement error, the estimated intergenerational correlations range from 0.45 to 0.75 for father-child pairs and from 0.30 to 0.50 for mother-child pairs. In addition, we find strong nonlinear effects (typically, the intergenerational elasticity increases with parental status), and a substantial decline in cross-generation correlations in occupational prestige over time. We also analyse a special sample in which young adults (aged 16 or above) are matched to one or both of their biological or adoptive parents interviewed in at least one of the nine years of the panel survey. This analysis is primarily suggestive of what can be done with BHPS data, but its estimates are far from conclusive. With monthly earnings and annual income as measures of economic status, OLS estimates of the intergenerational correlation are at most around 0.05, while IV estimates are at most around 0.20. The implied high economic mobility for this sample is arguably due to life cycle considerations. This is an area that deserves additional research attention as more data become available. JEL Classification: J62, I2, D31