Intergenerational educational mobility: Three essays on measurement error, cross-country differences in mobility and long-run growth

Type Journal Article
Title Intergenerational educational mobility: Three essays on measurement error, cross-country differences in mobility and long-run growth
Publication (Day/Month/Year) 2008
This dissertation is a study of educational mobility. It is divided into three essays on the consequences of measurement error for educational mobility coefficients, socio-economic explanations of differences in mobility across countries, and the relation between mobility and long-run economic growth.\n\nEssay 1 uses household survey data for Sri Lanka and Brazil to measure the reliability of reported education statistics, and investigates the implications of mean reversion and correlated measurement errors for educational mobility coefficients. I develop a theoretical model of measurement error and use a simple simulation exercise to demonstrate the inability of reliability coefficients to perfectly compensate for attenuation of regression parameters in the non-classical case. The chapter further explores whether there is any systematic component in the variance of measurement error. I find that reliabilities are reasonable for Sri Lanka, around 70%, 90% for Brazil PNAD and do not vary significantly with correlates such as age and education of respondent. Brazil's PPV reliability coefficients do not perform well, and are in the vicinity of 45%. After I adjust regression coefficients by reliabilities, however, the estimate of Brazil's intergenerational mobility coefficient of education is relatively uniform for both PPV and PNAD data.\n\nEssay 2 uses household survey data on children and their parents to explain cross-country differences in intergenerational educational mobility. I extend my previous research in Hertz et al. (2007) to report adjusted intergenerational mobility coefficients that incorporate the role of wealth, ethnicity and location into their construct. I find surprisingly little evidence of an ethnic explanation across countries for social background-related immobility.\n\nEssay 3 sheds some light on the relationship between upward educational mobility and long-term economic growth. I estimate cross-sectional growth equations within the framework of the Sala-i-Martin(1997b) methodology to study the relation between intergenerational educational mobility and growth. I find that greater intergenerational educational mobility is associated with lower levels of long term economic growth. This perverse result might be explained by the fact that increased immobility increases both inequality and the incentive to work harder leading to productivity increases. More research needs to be done here including the exploration of endogeneity between growth and mobility coefficients.

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