The impacts of family background on children’s educational attainment and earnings

Abstract

This study analyzes the parental schooling and income impacts on their children’s outcomes that to a large extent determine the standard of living they achieve in the future: educational attainment and earnings. OLS estimations of child schooling and child earnings regressions are conducted. The results point to a strong positive relationship between children’s outcomes and their family background characteristics. The estimated strong intergenerational links promise children of highly educated and wealthy parents a high standard of living while doom children of low educated and poor parents to enjoy a lower quality of life. Persistency in intergenerational links found in this study proves to be an obstacle in overall economic development which may call for the government to generate policies that break the harmful intergenerational links either through providing equal opportunity in accessing education for low-income/low educated families’ children or through redistributing income across poor families that help them invest more in their children’s human capital.

Keywords

• Intergenerational Mobility
• Human Capital
• Personal Income

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