Transmission Mechanism of Intergenerational Mobility in Socio-Economic Status

Malik Muhammad and Shabib Haider Syed

Abstract

The strength of intergenerational mobility in socio-economic status represents the equality of opportunities available to the citizens. It affects motivation, efforts, innovations and productivity of individuals and thereby overall inequality and economic growth of a country. In less mobile societies, opportunities of success are not equal and are limited for the less educated poor segment. Not only their current but also the future generation remains under developed. Skills and talents of the poor are wasted and their motivations of getting education and working hard decrease. This impedes them to move to the high status occupations. There are different mechanisms through which the socio-economic status is transmitted from the generation of the parents to their children. At family level, the investment on the part of the parents in the form of social, human and health capital of their children determine their socio-economic status. At social level, environment available to an individual, social network, self-identity in the society etc. play their roles in intergenerational mobility of socio-economic status. Similarly, genes affect the level of ability of the children and transfer cognitive and non-cognitive skills from the parents to the children. Genes also affect human capital through health of the children which in turn determines their level of income. Finally, the pattern of marriages plays its role in the mobility of socio-economic status as parents give due consideration on the socio economic status of the children’s partners. The trend to marry in the similar families causes persistence in socio-economic status.