Krueger,TheAppleFallsClosetotheTree-SESTransmission,2002(2)

Krueger,TheAppleFallsClosetotheTree-SESTransmission,2002(2)...

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The New York Times, November 14, 2002 The Apple Falls Close to the Tree By ALAN B. KRUEGER It seems increasingly apparent that the secret to success is to have a successful parent. Consider some prominent examples: George H. W. Bush and George W. Bush; Bobby Bonds and Barry Bonds; Henry Fonda and Jane Fonda; Estée Lauder and Ronald Lauder; Julio Iglesias and Enrique Iglesias; Sam Walton and Jim, John, S. Robson and Alice Walton. As more recent and better data have become available, economists have marked up their estimate of the impact of parents' socioeconomic status on their children's likelihood of economic success. It turns out that the famous line attributed to Andrew Carnegie — "from shirt-sleeves to shirt-sleeves in three generations" — is an understatement. Five or six generations are probably required, on average, to erase the advantages or disadvantages of one's economic origins. This represents a marked departure from past thinking. In the 1980's, when Gary S. Becker of the University of Chicago pioneered the economic theory of intergenerational transmission of economic status, it was believed that the correlation between a father's and son's income was only around 0.15 — less than half the correlation between fathers' and sons' heights. The early studies suggested that if a father's income was twice the average, his son's expected income would be 15 percent above average, and his grandson's just 2 percent above average. This is fast "regression to the mean," a concept Sir Francis Galton used to
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Krueger,TheAppleFallsClosetotheTree-SESTransmission,2002(2)...

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