Fri, 09 Dec

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Macquarie Uni City Campus | Online

Technological Change, Occupational Switches, and Intergenerational Mobility

Andrew Carter, Arpita Chatterjee, Aarti Singh, and Satoshi Tanaka with: Aarti Singh

Technological Change, Occupational Switches, and Intergenerational Mobility

Time & Location

09 Dec, 12:00 pm – 2:00 pm

Macquarie Uni City Campus | Online, Level 24/123 Pitt St, Sydney NSW 2000, Australia

About the event

This paper studies the role of parental occupational succession in the intergenerational correlation of income. 

Using unique administrative tax record data linking parents and their children, who comprise 10% of Australia’s working population, we find that most of the intergenerational correlation in income can be explained by parent-child groups working in the same occupation. Our empirical results indicate that children who follow their parents’ occupations have, on average, lower-income rankings, and higher intergenerational persistence. Based on these findings, we construct a dynamic model of endogenous occupational choice in which children’s occupational choices depend on economy-wide labour market changes, child-specific absolute and comparative advantages in different occupations, network externalities arising from parental occupations, and relative wages. This structural model allows us to understand the impact of various long-term technological changes on occupational choice and intergenerational mobility. We plan to use the calibrated model to understand how government policies can mitigate the distributional implications of technological change by altering agents’ occupational choices.

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