Measurement and Cross-Country Differences

27 ii that the generational elasticity among the

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Unformatted text preview: this elasticity is lower, possibly about 50% lower, than in the United States. Table 8 offers the least squares results for the fatherdaughter earnings relationship. All of the estimated elasticities are not statistically different from 0, though the point estimates suggest a very weak negative correlation. This is in contrast with both the existing Canadian literature for the population at large and the findings of Card, DiNardo, and Estes (2000). Two Canadian-based studies examine the generational mobility of daughters, focusing on annual earnings. Fortin and Lefebvre (1998, table 4.3) use a similar estimator with Census data that is based upon averages of occupational earnings to suggest that in 1994 the father-daughter elasticity is in the neighborhood of 0.22; though one of their estimates is as low as 0.14, it remains statistically significant. Corak (2001, table 1) uses administra- tive data that directly link fathers with their children and reports a father-daughter earnings elasticity of 0.20. Card, DiNardo, and Estes (2000, table 6.7) report 0.21 for U.S. immigrants using their 1940–1970 sample, and 0.50 for their 1970–1995 sample. The latter result is not significantly different from the 0.62 reported for fathers and sons. Figures 1 and 2 are scatter plots of the seventy data points and the estimated regression lines from row 3 of tables 7 and 8. The regression line is estimated with weighted least squares. In order to draw further insights we identify any particularly influential data points by successively dropping a single observation from the regression and reestimating equation (1) with the remaining 69 observations. We do this for each observation and obtain 69 separate estimates of , which are plotted in figure 3 for sons and figure 4 for daughters. The results are always within one standard error of the preferred estimates in row 3 of tables 7 and 8 based on all seventy observations. This exercise highlights that sons of fathers from China and the United Kingdom have a noticeable impact on the point estima...
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