Conference on Social Mobility and Inequality in Israel
14-15 June 2017 Jerusalem
P R O G R A M
Wednesday 14.6.2017
8:30-9:00
Registration and Reception | Dorot Auditorium
09:00-13:15
SESSION I Welcome: Reuben Gronau Momi Dahan “The Evolution of Income Inequality: Israeli Exceptionalism” Discussant: Reuben Gronau, Eugene Kandel
10:15-10:30
Break Miri Endeweld and Haya Stier “Intra-generational Wage Mobility and Inequality in Israel 1990-2015: Age and Gender Aspects” Discussant: Markus Jäntti Markus Jäntti (together with Anders Björklund) “Intergenerational Mobility, Intergenerational Effects, Sibling Correlations, and Equality of Opportunity: A Comparison of Four Approaches” Discussants: Miles Corak, Manuel Trajtenberg
12:30-13:45
Lunch
2 | Program
13:45-17:45
SESSION II Yossi Shavit (together with Herman van de Werfhort, Tony Tam, Hyunjoon Park, Assaf Rotman and Michael Shalev) “Trends in Intergenerational Educational Mobility: Nominal and Positional Perspectives” Discussant: Yoram Weiss Vered Kraus and Meir Yaish “Class Mobility in Israel: 1970s-2010s” Discussant: Yitzhak Haberfeld
15:30-15:45
Break Sigal Alon “Field of Study Choices and Mobility Trajectories” Discussant: Haya Stier Thomas DiPrete (together with Thijs Bol, Christina Ciocca, Herman van de Werfhorst) “School to Work Linkages and Labor Market Earnings: A Comparison of France, Germany, a nd the US” Discussant: Ayal Kimhi
17:30-17:45
Closing of Day 1
3 | Program
Thursday 14.6.2017
8:30-9:00
Reception and Coffee
9:00-13:00
SESSION III Eric D. Gould (together with Avi Simhon and B ruce A. Weinberg) “Does Parental Quality Matter? – Evidence on the Transmission of Human Capital Using Variation in Parental Influence from Death, Divorce, and Family Size” Discussants: Barbara Okun Analia Schlosser (together with Yannay Shanan) “Fostering Non-Cognitive Skills in Active Labor Market Programs: Evidence from an RCT in Israel” Discussant: Noah Lewin-Epstein
11:00-11:15
Break Alan Krueger (together with Lawrence F. Katz) “The Fading American Dream: Trends i n Absolute Income Mobility Since 1940 – a Comment” Rejoinders: Markus Jäntti, Miles Corak, Jo Blanden, Oren Heller Oren Heller “Intergenerational Income Mobility in Israel” Discussants: Tslil Aloni, Michael Beenstock
13:00-14:00
Lunch, Modern Restaurant
4 | Program
14:00-17:45
SESSION IV Jo Blanden (together with Stephen Machin) “Home Ownership and Social Mobility” Discussant: David Genesove Miles Corak “Divided Landscapes of Economic Opportunity: The Canadian Geography of Intergenerational Income Mobility” Discussant: Daniel Felsenstein
16:00-16:15
Break
16:15-17:45
PANEL DISCUSSION “Inequality and Social Mobility: L essons and Warning Signs” Lee Elliot Major, Alan Krueger
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Wednesday 14.6.2017
6 | Wednesday 14.6.2017, Session I
SESSION I 09:00-13:15
The Evolution of Income Inequality: Israeli Exceptionalism Momi Dahan
Momi Dahan has been a faculty member in the School of Public Policy at The Hebrew University since 2002 and was its Director from 2011–2014. His work reflects his long-term research aimed at exploring the roots of economic inequality and their consequences. This has resulted in both theoretical, methodological and empirical contributions that have been published in leading journals in several academic fields: Economics, Public Policy, Political Science, Environmental Science, Area Studies, and Psychology. Professor Dahan holds a PhD in Economics from The Hebrew University and has since served in a series of senior positions in the public sector. He was Chief Economist in the Bank of Israel (1989–1999) before becoming a senior adviser in the Finance Ministry (1999–2001). He also chaired or was a member of several public committees. Between 1997 and 1999 he served as an economic adviser in both the International Monetary Fund and Inter-American Development Bank.
Momi Dahan
Income Inequality in Israel A b s t r a c t The level of disposable income inequality in Israel has increased noticeably since the mid-1980s and Israel today leads the developed countries in that regard. In contrast, market income inequality that hit a record level in 2002 has
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since reversed, showing a sharp decline, so that the Gini coefficient of market income in Israel is now below the OECD average. This paper offers tentative explanations for the inverted-U shaped evolution of market income inequality in Israel over the last 25 years, which is distinctive compared to that of most developed countries in the same period. In addition, this paper explains why Israel has one of the highest disposable income inequality gaps but is ranked below the OECD average measure of market income inequality.
Intra-generational Wage Mobility and Inequality in Israel 1990–2015: Age and Gender Aspects Miri Endeweld and Haya Stier
Haya Stier is Professor of Sociology and Labour Studies at Tel Aviv University. She received her PhD in Sociology from the University of Chicago in 1990, and her BA and MA in Sociology from Tel Aviv University. She has served as President of the International Sociological Association’s Research Committee on Stratification (ISA-RC28); Head of the Welfare Policy Programme at the Taub Centre for Social Policy Studies in Israel; Chair of the Labour Studies Depart�ment at Tel Aviv University; Head of the Institute for Social Research at Tel Aviv University and Editor of Israeli Sociology. Professor Stier’s research interests include issues of work, gender and the family, poverty and inequality. She is currently focusing on the effect of institutional arrangements on the quality of employment; the organisation of households; and family patterns in a comparative framework. She also studies the distribution of poverty in Israel, with a special focus on women and minorities. Miri Endeweld is Director of the Economic Research Division of the Research and Planning Administration at the National Insurance Institute (NII). As part of her job, she conducts studies in socio-economics, participates in committees and forums on these subjects and prepares reports on poverty and social gaps as well as overseeing the annual survey of the NII. Dr Endeweld holds a BA in Economics and Sociology and an MA in Business Administration from
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The Hebrew University of Jerusalem and a PhD in Labour Studies from Tel Aviv University. She is also a Research Fellow at the School of Public Policy at The Hebrew University of Jerusalem.
Miri Endeweld and Haya Stier
Wage Mobility of Young Workers in an Old and New Labour Market: Israel 1990–2015 A b s t r a c t This study examined the absolute and relative mobility of young workers who entered the Israeli labour market at various points during the period 19902015. The findings, based on registered data show that as could be expected, the main growth in the wages of young people occurs in the first five years, and slightly less so in the following five years. Thereafter there is a significant slowdown in the wage growth. However, the findings show that the real wages of young people who joined the labour market in 2010 were similar or lower than those who entered earlier, even though the economy grew during these years. In addition, the returns to education declined. Our findings provide support for the general feelings of worsening economic condition shared by many young people that might have led to the outbreak of the social protest in 2011. This trend of decline was largely restrained in the years following the social protest. Aggregate indices of relative mobility show that alongside the rise in inequality during the period 1990-2005, there was also a decline in mobility. In the last decade, 2005-2015, mobility has risen, despite the known fact that during this period, low-income populations have joined the labour market. The findings also show growing divergence among population groups and industries. The gender gap did not narrow substantially in initial wages and continued to grow over the life course as men enjoyed not only higher wages but also higher rates of upward mobility. Hi-tech workers and the well-educated enjoyed high wages and high rates of mobility compared to less skilled workers, increasing the polarization in wages and prospects in the Israeli labour market, although the decline of real wage affected all groups of workers.
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Intergenerational Mobility, Intergenerational Effects, Sibling Correlations, and Equality of Opportunity: A Comparison of Four Approaches Markus Jäntti (with Anders Björklund)
Markus Jäntti is Professor of Economics at the Swedish Institute for Social Research, Stockholm University. His research centres on income and wealth inequality, poverty and socio-economic mobility, especially from a cross-national perspective. He has recently devoted attention to trying to understand and quantify the importance of family background in the distribution of economic resources.
Anders Björklund and Markus Jäntti
Intergenerational Mobility, Intergenerational Effects, Sibling Correlations, and Equality of Opportunity: A Comparison of Four Approaches A b s t r a c t The paper summarizes and discusses four different approaches to the study of how individuals’ income and education during adulthood are related to their family background. The most well-known approach, intergenerational mobility, describes how the income and education of parents and their offspring are related to each other. The intergenerational-effect literature addresses the question of how an intervention that changes parental income or education can affect the outcomes for their children. The sibling-correlation approach estimates the share of total inequality attributed to factors shared by siblings, which is generally higher than is revealed by intergenerational mobility estimates. Finally, the equality-of-opportunity approach looks for a set of factors in the family background or otherwise, that are important for children’s outcomes and for which children cannot be held accountable. We argue that all four approaches address relevant questions and that recent research has provided insightful results. However, by comparing all these results, it is possible to paint a more nuanced picture of the role of family background. We recommend that scholars working in the four subfields pay more attention to each other’s research.
SESSION II 13:45-17:15
Trends in Intergenerational Educational Mobility: Nominal and Positional Perspectives Yossi Shavit
Yossi Shavit is a Professor of Sociology at Tel Aviv University and holds the Weinberg Chair of Sociology of Stratification Inequality. Until recently he served as President of the Israeli Sociological Association. He currently heads the Policy Committee for Education at the Taub Centre for Social Policy Studies in Israel, and is a member of the Sociological Research Association. He previously served as Professor at the European University Institute in Florence. His main research and teaching areas are educational stratification processes, educational policy, occupational stratification, Jewish-Arab relations in Israel, marriage markets, and research methods. Professor Shavit holds a BA in Sociology and Economics from The Hebrew University of Jerusalem, and an MSc in Demography and a PhD in Sociology (1983) from the University of Wisconsin-Madison.
Assaf Rotman, Yossi Shavit and Michael Shalev
Nominal and Positional Perspectives on Educational Stratification in Israel A b s t r a c t This paper examines whether the rising accessibility of educational qualifications narrows the association between social origin and educational attainment. Research is divided on the question of the persistence of inequality of educational opportunities (IEO). Currently, most studies focus on the attainment of nominal levels of education and fail to acknowledge that educational expansion is accompanied by changes in the value of qualifications and in their
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scarcity. This study employs measures of educational attainment that capture the changing scarcity and economic value of qualifications. Data from the 1995 and 2008 censuses in Israel are used to compare the association of socioeconomic origin with educational attainment between two birth cohorts. The results show that IEO tends to persist or decline when attainment is measured in absolute terms, but tends to increase when relative measures of qualifications or measures representing their economic value are employed. The familiarity of better-off parents with the school system and their awareness of changes in the value of qualifications are offered as a central factor explaining the findings.
Herman van de Werefhorst, Tony Tam, Yossi Shavit and Hyunjoon Park (in progress)
Positionally Maintained Inequality in Education: Trends in Intergenerational Educational Mobility in 35 Nations A b s t r a c t In this paper the intergenerational educational mobility for post-war generations is studied across 35 countries. We argue that educational mobility in positional (‘relative’) terms is significantly more resilient to change than educational mobility when defined in conventional, nominal terms. By employing survey data for many advanced economies, we show that positional educational mobility is persistent across cohorts, while nominal educational mobility has increased. Educational expansion may improve educational mobility in nominal terms, but the relative position that is transferred from one generation to the next is highly similar across cohorts. For the 35 countries, the validity of claims that educational mobility is ‘persistent’ or ‘non-persistent’ depends heavily on whether education is seen as a positional good. We conclude that a positional conception of social advantage deserves more attention in social mobility studies, alongside conventional nominal conceptions of advantage.
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Eyal Bar Haim and Yossi Shavit
The Broadening of Higher Education, Economic Equality and Equality of Educational Opportunities A b s t r a c t Changes in inequality between socio-economic strata in educational opportunity at the tertiary level are examined in this paper. We suggest a new approach to the understanding of change in inequality of educational opportunities (IEO), which combines both economic inequality and educational expansion as determinants of change in IEO. The paper makes a theoretical distinction between economic inequality and inequality of opportunities, and discusses the association between them. This is followed by a review of the changes in Israeli higher education and in economic inequality. Lastly, we analyse several data sets (ESS, ISSP and LIS) to estimate the effects of the expansion of higher education and the increase in income inequality in Israel on inequality of opportunities to acquire higher education. We show that the failure of educational expansion to reduce IEO at the tertiary level is partially due to the contemporaneous increase in economic inequality, which has a positive effect on IEO.
Class Mobility in Israel: 1970s–2010s Vered Kraus and Meir Yaish
Meir Yaish is Chair of the Department of Sociology and Anthropology at the University of Haifa. He is also Editor-in-Chief of the Journal Research in Social Stratification and Mobility (RSSM). In 2006–2010 he served as Secretary/Treasurer of the International Sociological Association’s Research Committee on Social Stratification and Mobility. Professor Yaish joined the University of Haifa after spending three years (1999–2002) as a Research Fellow at Nuffield Col� lege, University of Oxford, where he obtained his PhD in 1998. His dissertation was titled ‘Opportunities, Little Change. Class Mobility in Israeli Society: 1974–1991.’ He also holds an MA in Sociology (cum laude) from the University of Haifa (1995). Professor Yaish’s research interests are in social stratification and mobility, the sociology of education, and the puzzle of altruism. He has published internationally in these fields.
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Vered Kraus is Professor in the Department of Sociology and Anthropology, University of Haifa, with a speciality in Methodology, Social Stratification, Educational and Occupational Mobility among women in the paid labour market.
Meir Yaish and Vered Kraus
Class Mobility in Israel: 1970s-2010s A b s t r a c t Our interest in social mobility is mainly because it provides evidence on the extent to which Israel’s commitment to equal opportunity has been realized. The surge in economic inequality in recent decades and its alleged negative potential effect on equality of opportunity makes the study of social mobility more important than ever. This research agenda has a long history in Sociology, where measures of intergenerational mobility are derived from an individual’s position in the labour market: occupational prestige, occupational groups, and class. Our objective is to provide evidence that is as accurate and contemporary as possible – utilizing new, high quality and unique data on patterns and trends in intergenerational class mobility in Israel. The deficiencies of previous sociological studies, based largely on father to son mobility, make it difficult to relate the recent surge in income inequality to intergenerational mobility patterns and trends. Previous research in Israel does, however, show that (i) in a comparative perspective, social mobility is relatively high, and (ii) this high level is relatively stable over time. Our new data will enable us to study intergenerational mobility well into the current millennia, allowing us to follow trends from the 1970s through to 2010 and beyond. We shall also be paying special attention to intergenerational mobility patterns and trends in Israel’s sub-populations. Results suggests that intergenerational class mobility rates are no longer constant in Israel. Social fluidity has increased for both Jewish men and women (and decreased for both Arab men and women). These trends cannot be related to the surge in economic inequality in Israel for either Jews or Arabs. We argue that the tendency towards closure amongst Arabs in Israel reflect the emergence of a Palestinian middle class.
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Field of Study Choices and Mobility Trajectories Sigal Alon
Sigal Alon is an Associate Professor in the Department of Sociology and Anthropology at Tel Aviv University. Her main research interests include social stratification and mobility, with an emphasis on higher education. Her work focuses on revealing the dynamics and historical processes underlying class, gender, and racial-ethnic inequalities in educational attainment, and the extent to which admission, retention, affirmative action and financial aid policies in higher education narrow these inequalities. Professor Alon has published in leading journals in Sociology, Education and Economics and is the author of Race, Class and Affirmative Action, which evaluates the ability of class-based affirmative action to promote the social and economic mobility of disadvantaged populations and boost diversity at selective postsecondary institutions, as compared with race-based policy. Her research has been supported by grants from several foundations, including Yad Hanadiv.
Sigal Alon (in progress)
The Price of Ambition: The Academic Matching of Field of Study Choices and Ethnic Gaps in Admission Rate A b s t r a c t Recent evidence suggests that field of study (FOS) is the most important determinant of future earnings, even after controlling for ability. While FOS choices are typically seen as a reflection of individual tastes and academic/vocational abilities, we may expect to find systematic differences between applicants in FOS choice sets because decisions and choices are partly shaped by social identities. Such differences are important because they eventually determine the type of degree students obtain, their career prospects and future wages and the chances for socioeconomic mobility. This study shed light on how individuals’ placement on ethnic hierarchies shape their decisions regarding their preferred FOS at the college application stage. Specifically, using Israel as a case study, I examine ethnic-based patterns of mismatch between applicants’ academic abilities and the academic demands of a field and assess how they account for the ethnic gap in the likelihood of admission.
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School to Work Linkages and Labour Market Earnings: A Comparison of France, Germany, and the US Thomas DiPrete (with Thijs Bol, Christina Ciocca, Herman van de Werfhorst)
Thomas A. DiPrete is Giddings Professor of Sociology and Co-Director of the Institute for Social and Economic Research and Policy at Columbia University. He has also been on the faculties of the University of Chicago, Duke University and the University of Wisconsin–Madison. Professor DiPrete’s research focuses on social inequality and the life course. A specialist in comparative research, he has held research appointments at the Max Planck Institute for Human Development in Berlin, the Social Science Research Centre in Berlin, the German Institute for Economic Research in Berlin, the VU University Amsterdam, the Netherlands Institute for Advanced Study in the Humanities and Social Sciences, and the University of Amsterdam. His ongoing work includes a comparative study of how educational expansion and the structure of linkages between education and the labour market contribute to earnings inequality in several industrialized countries, and research into how social comparison processes affect the compensation of corporate executives.
Thijs Bol, Christina M. Ciocca, Herman G. van de Werfhorst, Thomas A. DiPrete
School-to-Work Linkages and Labour Market Earnings A b s t r a c t This paper studies how school-to-work linkages affect earnings. Using multi-group segregation measures, we estimate how strongly detailed educational qualifications link to specific occupations. We then examine whether and how the linkage strength of educational qualifications is associated with earnings in France, Germany and the United States. First, we employ both a within-country design and a between-country design to explain wage differentials between educational degrees within countries by the variation in linkage strength. In general, workers have higher earnings in the occupations that best link to their
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educational level and field of study. However, the size of this boost to earnings depends on how strongly the educational credential links to the occupational structure. Comparing workers with the same educational credential across countries shows that the benefit of having a tertiary credential and matching well to an occupation is larger in the country where the linkage strength is stronger. At the country level, linkage strength affects wage inequality through its impact both on between-occupation wage inequality and on wage inequality within occupations.
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Thursday 15.6.2017
SESSION III 09:00-13:00
Does Parental Quality Matter? – Evidence on the Transmission of Human Capital Using Variation in Parental Influence from Death, Divorce, and Family Size Eric D. Gould (with Avi Simhon and Bruce A. Weinberg)
Eric D. Gould is a Professor of Economics at The Hebrew University, where he has taught since completing his PhD at the University of Chicago. He is also a Research Fellow at the Centre for Economic Policy Research in London (CEPR), a Research Fellow at IZA in Bonn, a Fellow at the Centre for Research and Analysis of Migration (CReAM) at University College London, and an Associate Editor of Labour Economics. Professor Gould’s research focuses on various empirical issues, such as the causes and consequences of increasing income inequality, marriage market behaviour, the economics of crime and terrorism, education, the effect of the environment on the economic and social outcomes of individuals, and immigration.
Eric D. Gould, Avi Simhon , Bruce A.Weinberg
Does Parental Quality Matter? Evidence on the Transmission of Human Capital Using Variation in Parental Influence from Death, Divorce, and Family Size. A b s t r a c t This paper examines the transmission of human capital from parents to children by exploiting variation in parental influence due to parental death, divorce, and the increasing specialization of parental roles in larger families.
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The model use illustrates the role of each source of variation in identifying the causal effect of parental human capital on a child’s schooling outcomes. All three sources of variation yield strikingly similar patterns, which show that the strong parent-child correlation in human capital is largely causal. For children who lost a parent, the education of the deceased parent is less important in determining child outcomes than that of the surviving parent. This pattern intensifies when a child loses a parent earlier in life – the education of the deceased parent becomes even less important, while the effect of the surviving parent’s schooling intensifies. Similar results are found for children who spent more time with their mother due to divorce or larger family size. In both cases, the mother’s education becomes more important relative to the father’s. These findings help us to understand why educated parents typically spend more time with their children despite their higher cost of time – they are more effective in producing human capital in their children.
Fostering Non-Cognitive Skills in Active Labour Market Programmes: Evidence from an RCT in Israel Analia Schlosser (together with Yannay Shanan)
Analia Schlosser is a Senior Lecturer at the Tel Aviv University School of Economics and member of the CESifo and IZA international research groups. Her main areas of research are education economics, economic development and labour economics. She has held research positions in the Evaluation Department of the Ministry of Education and has participated in various public committees. Dr Schlosser completed her postdoctoral fellowship at Princeton University and holds a PhD (2007) in Economics from The Hebrew University of Jerusalem.
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Analia Schlosser, Yannay Shanan
Fostering Non-Cognitive Skills in Active Labour Market Programs: Evidence from an RCT in Israel A b s t r a c t Using a randomized controlled trial, we evaluated the effectiveness of an Israeli Active Labour Market Programme targeted at income support claimants. Participants receive personalized weekly sessions with occupational trainers and participate in motivational and job search assistance workshops. We found that in the short run, the programme increased the employment rate of participants by 7.9 percentage points, and decreased income support recipiency by 10.7 percentage points relative to the control group. The effects are larger for high school dropouts and those with a longer history of welfare dependence. One of the possible mediating factors of the programme’s impact is an improvement in non-cognitive skills. That is, the programme had a positive and significant effect on the work self-efficacy and job search self-efficacy of its participants. We also examined the dynamic effects of the programme over time and found that its impact on newer income support claimants, who are characterized by higher labour force attachment, is largely driven by a threat effect, whereas those with a longer history of welfare dependence seem to be more affected by the services provided by the programme. We concluded that unemployed income support claimants with lower labour force attachment can gain the most out of an intervention aimed at improving their work-related non-cognitive skills.
The Fading American Dream: Trends in Absolute Income Mobility Since 1940 – a Comment Alan Krueger (together with Lawrence F. Katz)
Alan Krueger has published widely on the economics of education, terrorism, unemployment, labour demand, income distribution, social insurance, labour market regulation and environmental economics. Since 1987 he has held a joint appointment in the Economics Department and Woodrow Wilson School
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at Princeton University. He is the founding Director of the Princeton University Survey Research Centre. Prof. Krueger received a BS degree (Hons.) from Cornell University’s School of Industrial and Labour Relations in 1983, and an MA (1985) and PhD (1987) in Economics from Harvard University. He served as Assistant Secretary for Economic Policy and Chief Economist of the US Department of the Treasury in 2009–10, and as Chair of President Obama’s Council of Economic Advisers in November 2011. He was Chief Economist for the National Council on Economic Education (2003–09). Among Professor Krueger’s many distinguished awards are the Kershaw Prize by the Association for Public Policy and Management in 1997 and the IZA Prize in Labour Economics with David Card in 2006. In 2002 he was elected a fellow of the American Academy of Arts and Sciences, and in 2003 a fellow of the American Academy of Political and Social Science.
Lawrence F. Katz, Alan B. Krueger
Commentary on “The Fading American Dream: Trends in Absolute Income Mobility Since 1940 (Prepublication Draft Science, 2017) A b s t r a c t This paper estimated the fraction of individuals aged 30 who earn more than their parents did at roughly the same age, defined as absolute income mobility, Chetty et al. (2017) combine IRS tax data with census data, deflate for consumer price inflation, and make assumptions concerning the stability of the joint distribution of parents’ and children’s income ranks (the copula) in years when linked data on both parents and their children are unavailable. Their striking conclusion is that there has been a large decline in upward absolute mobility across successive US birth cohorts, from 92 per cent of children born in 1940 earning more than their parents circa age 30, to only half of the children born in 1984. As a practical matter, we show that real median income of children and parents is a sufficient statistic for predicting absolute mobility, and does not require linked data on children and parents. This convenient finding is because of the stability of the copula. To increase upward mobility, we recommend considering interventions to raise real median income over time, specifically: (1) policies to foster faster productivity growth; (2) policies to raise human capital, particularly for children from the bottom half of the income distribution; (3) policies to raise wages and employment of low-income households; (4) tax and transfer policy; and (5) place-based and geographic mobility policies.
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Intergenerational Income Mobility in Israel Oren Heller
Oren Heller holds a BA in Mathematics and Economics and an MA in Economics from The Hebrew University of Jerusalem. Since 2013 he has been a senior researcher in the Economic Research Department of the National Insurance Institute (NII), writing and editing articles and position papers focusing on poverty and inequality in Israel. He is currently writing a doctoral dissertation on intergenerational mobility under the supervision of Professor Joseph Zeira and Dr Alon Eisenberg at The Hebrew University, and his conference paper was written as part of his research at the NII.
Oren Heller
Intergenerational Income Mobility in Israel A b s t r a c t This paper describes the characteristics of intergenerational mobility in Israel. It is one of the first research projects using Israeli administrative data, including income/wage, education and demographic data, in order to comprehensively estimate and describe intergenerational income mobility. Intergenerational mobility over the last three decades is described with estimations based on those born in the 1970s and early 1980s and their parents. The objectives are to estimate the level of mobility at the national level, to perform an international comparison of this estimation, and to make cross-comparisons and indicate patterns of differences in the level of mobility between different population groups. Maintaining estimation methods consistent with those accepted in the current literature allows, for the first time, the inclusion of Israel in existing international comparisons. Using linear estimation, the average intergenerational income elasticity (IGE) between fathers and their children is estimated at 0.276. This attests to a slightly higher intergenerational mobility than expected, given the level of inequality in Israel and the Great Gatsby curve that links these two characteristics. Non-parametric estimation shows that elasticity changes over the fathers’ wage distribution, being negligible at the beginning and reaching 3.5 at the end. It was also found that the inter-generational mobility of Arabs is lower than that of Jews, and that this is not the result of differences
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in the characteristics of residential areas or the quality of the schools in which the children studied. Ultra-Orthodox Jews have a level of mobility similar to that of non-ultra-Orthodox Jews, but as their wages are low, their level of upward mobility is also low. Immigrants and children of immigrants are less mobile than their Israeli-born counterparts. Mobility level also varies according to the family’s country of origin, with African/Asian immigrants being less mobile than European/American immigrants. Among non-ultra-Orthodox Jews, intergenerational mobility has a negative correlation with the level of peripherality of their residence, and a positive correlation with the quality of the high schools in which the children studied, as reflected in an achievement-based estimate.
SESSION IV 14:00-17:45
Home Ownership and Social Mobility Jo Blanden and Stephen Machin
Jo Blanden is Reader in Economics and Research Director of the School of Economics, University of Surrey, UK. She holds a BSc (Hons) in Economics from the University of East Anglia (1998) and an MSc and PhD in Economics (2005) from University College London. From 2000 to 2005 she was a fulltime researcher in the Centre for Economic Performance (CEP) at the London School of Economics. Dr Blanden joined the Department of Economics at Surrey in October 2005 and is a Visiting Fellow at the London School of Economics and Political Science (LSE). Her research interests lie broadly in the fields of labour and family economics, and she has worked extensively on intergenerational income mobility. With two colleagues, she is completing a large research project funded by the Nuffield Foundation on the impact of nursery attendance on children’s outcomes.
Jo Blanden and Stephen Machin
Home Ownership and Social Mobility A b s t r a c t This paper extends the literature on social mobility to investigate intergenerational links in home ownership, an important marker of wealth. Repeated cross-sectional data show that home ownership rates have fallen rapidly over time, and in particular amongst younger people in more recent birth cohorts. We then focus on two British birth cohorts for which we have information on parental home ownership. Comparing the intergenerational transmission of
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home ownership for individuals in the 1958 and 1970 British birth cohorts, we find that home ownership for 42-year-olds from the 1970 birth cohorts (in 2012) shrank disproportionately among those whose parents did not own their own home when they were children. Using housing measures in an intergenerational setting, and bearing in mind that housing is the major component of wealth for most people, our results reinforce a picture of falling social mobility in Britain.
Divided Landscapes of Economic Opportunity: The Canadian Geography of Intergenerational Income Mobility Miles Corak
Miles Corak is Professor of Economics with the Graduate School of Public and International Affairs at the University of Ottawa, Ottawa, Canada. His research interests include labour economics, inequality and intergenerational mobility, social mobility and public policy. He holds a PhD in Economics from Queen’s University, Belfast. He has many years’ experience working for the Canadian Federal Government, including in senior management at Statistics Canada.
Miles Corak
Divided Landscapes of Economic Opportunity: The Canadian Geography of Intergenerational Income Mobility A b s t r a c t Intergenerational income mobility varies significantly across Canada, with the landscape clustering into four broad regions. These are not geographically contiguous, and provincial boundaries are not the dividing lines. The important exception is Manitoba, which has noticeably less intergenerational mobility
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among eight indicators derived from a large administrative data set for a cohort of men and women born between 1963 and 1970. These indicators are derived for each of the 266 Census Divisions in the 1986 Canadian Census. They show that higher mobility communities are located in Southwestern Ontario, Alberta, and Saskatchewan, and tend to be correlated with lower poverty, less income inequality, and a higher share of immigrants.
28 | Discussants
D i s c u s s a n t s
Professor Reuben Gronau, Conference Chair, is an Emeritus Professor of Economics at The Hebrew University of Jerusalem. He serves as Chair of the Public Council for Statistics and the Bank of Israel’s Monetary Committee. Professor Eugene Kandel is Professor of Economics and Finance at the School of Business Administration, The Hebrew University of Jerusalem and CEO of the non-profit Start-Up Nation Central. He served as Chair of the National Economic Council. Professor Markus Jäntti, Professor of Economics, Swedish Institute for Social Research, Stockholm University Professor Miles Corak, Professor of Economics, Graduate School of Public and International Affairs, University of Ottawa MK Professor Manuel Trajtenberg is a Member of Knesset and a Professor of Economics at Tel Aviv University. He has chaired the National Economic Council, the Planning and Budgeting Committee of the Council for Higher Education and the Committee for Social and Economic Change (the Trajtenberg Committee). Professor Yoram Weiss, Professor of Economics at Tel Aviv University; member of the Israeli Government Committee on Wages in the Public Sector Professor Yitchak Haberfeld, Department of Labor Studies, Tel Aviv University Professor Haya Steir, Professor of Sociology and Labor Studies, Tel Aviv University Professor Ayal Kimhi, Department of Agricultural Economics and Management, The Hebrew University of Jerusalem Professor Barbara S. Okun, Professor of Demographic Studies, Department of Sociology and Anthropology, The Hebrew University of Jerusalem
29 | Discussants
Noah Lewin-Epstein, Professor of Sociology and Dean of the Faculty of Social Science, Tel Aviv University; Secretary of the International Social Survey Program (ISSP); former President of Israel Sociological Society Jo Blanden, Reader in Economics and Research Director of the School of Economics, University of Surrey Oren Heller, Doctoral student at The Hebrew University of Jerusalem; Senior Researcher, Economic Research Department, National Insurance Institute Tslil Aloni, Pinhas Sapir Center for Development, Tel Aviv University Professor Michael Beenstock, Professor Emeritus of Economics, The Hebrew University of Jerusalem Professor David Genesove, Professor of Economics, The Hebrew University of Jerusalem Professor Daniel Felsenstein, Professor and Chair of the Department of Geography, The Hebrew University of Jerusalem