Working Paper: NBER ID: w25732
Authors: Paolo Acciari; Alberto Polo; Giovanni L. Violante
Abstract: We link tax returns across two generations to provide the first estimate of intergenerational mobility in Italy based on administrative income data. Italy emerges as less immobile than previously depicted by studies using proxies for economic status or survey data with imputation procedures. This conclusion is robust with respect to a number of concerns, both standard when using administrative data and specific to our sample. A 10 percentile increase in parental income is associated with a percentile increase in child income between 2.5 and 3. The expected rank of children born from parents with income below the median is around 0.43. Upward mobility is higher for sons, first-born children, children of self-employed parents, and for those who migrate once adults. We uncover substantial geographical variation in the degree of upward mobility. Provinces in Northern Italy, the richest area of the country, display levels three times as large as those in the South. This regional variation is strongly correlated with local labor market conditions, indicators of family instability, and school quality.
Keywords: intergenerational mobility; income distribution; Italy; administrative data
JEL Codes: J31; J61; J62; R1
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Parental income (D31) | Child income (J13) |
| Parental income (D31) | Child income ranks (J13) |
| Child income ranks (J13) | Upward mobility (J62) |
| Parental income (D31) | Rank-rank slope (C29) |
| Parental income (D31) | Intergenerational elasticity of income (IGE) (D31) |
| Regional differences (R12) | Upward mobility (J62) |