Recent research has uncovered large spatial heterogeneity in intergenerational mobility across neighborhoods in countries around the world. Yet there is little consensus on the reasons why mobility is high in some neighborhoods and low in others. This paper analyzes a generalized mobility model that examines the roles that families’ selection into neighborhoods and locational characteristics play in generating this spatial heterogeneity. We use administrative data from Denmark to decompose variation in mobility across nearly 300 larger and 2,000 smaller neighborhoods along these dimensions, accounting for sampling error. Families’ selection into neighborhoods and sampling error explain most observed heterogeneity across neighborhoods. Our generalized model explains most of the differences in mobility between neighborhoods, though a small but persistent difference remains between neighborhoods that our model cannot account for. An analysis of this “irreducible heterogeneity” suggests that neighborhoods exhibit multiple types in terms of their mobility effects.
Authors
Neil A. Cholli, Steven N. Durlauf, Rasmus Landersø, Salvador Navarro
- Acknowledgements & Disclosure
- Cholli thanks the National Science Foundation (NSF) Graduate Research Fellowship Program (Grant Number DGE-1746045), the U.S. Department of Education (ED) Institute of Education Sciences (IES) (Grant Number R305B140048), the Stone Center for Research on Wealth Inequality and Mobility at the University of Chicago, and the Klarman Fellowship at Cornell University for financial support. Durlauf thanks the James M. and Cathleen D. Stone Foundation for generous support. Navarro thanks the Social Sciences and Humanities Research Council of Canada for financial support. The views expressed herein are those of the authors and do not reflect the views of the NSF, IES, ED, or National Bureau of Economic Research.
- DOI
- https://doi.org/10.3386/w33035
- Pages
- 45
- Published in
- United States of America
Table of Contents
- Introduction 3
- Data 8
- Main Sample and Key Variables 8
- Descriptive Patterns of Neighborhood Stratification 10
- Baseline Results from the Workhorse Mobility Model 11
- Variation in Baseline Estimates of Neighborhood Mobility 12
- Second-Stage Correlations and their Interpretation 15
- Results from a Generalized Mobility Model 18
- Empirical Implementation 20
- Estimates from the Generalized Mobility Model 23
- Variance Decomposition 29
- Second-Stage Correlations 32
- Irreducible Heterogeneity across Neighborhoods 34
- Neighborhood Types 35
- Nonlinearities in Population Characteristics 36
- Discussion 40
- Conclusion 40
