Lifetime Economic Mobility:Understanding mobility within and across generations

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Intergenerational socio-economic mobility has re-emerged as one of the key issues in academic, media and political discourse over the last decade, following from academic research, including contributions from the applicants, that showed how mobility had declined in the UK. Despite this rise in prominence, research into intergenerational mobility is still, in many ways, in its infancy. This proposal aims to add three major new outputs to this evidence base, bringing in a new methodology emerging from a related field. The first part of the proposal directly asks the question of 'How mobile is our society?' addressing concerns about the accurate measurement of intergenerational mobility in the face of data limitations. When measuring mobility across generations we would ideally capture life-time mobility, observing the older generation across their offspring's entire childhood and the younger generation across their entire adult lives. These demanding requirements mean that ideal data are not fully available in the UK and estimates of mobility are based on measures at points in time. Such point in time estimates will differ from a life-time picture in three important ways. Previous literature has identified two of these issues: measurement error and life-cycle bias. These issues have been given limited attention to date in the UK. An additional measurement problem, which has yet to be considered at all in the literature, stems from the fact that earnings is only measured when people are working. Therefore we only measure the mobility of the employed. If we are attempting to measure a person's life time earnings, periods of worklessness will be important and are likely to shift our understanding of patterns of mobility, as worklessness is more common among those from deprived backgrounds. This new work will therefore give, for the first time in the UK, a robust estimate of how mobile our society actually is. Given what we already know about the likely biases in the data, we expect to find that the UK is far less mobile than previously acknowledged. The second research area addresses the limited advancements that have been made to date in understanding how other domains of intergenerational transmissions, such as education, class and worklessness, relate to intergenerational income mobility. We will introduce a new methodological approach, from the related field of earnings mobility, which adds a significant improvement in the assessment of how patterns of mobility are related across different dimensions of a person's origin. This technique also enables us to consider where in the distribution of family income in childhood that mobility across these domains actually occurs. This offers a step-advancement on what the current literature can offer in this area and brings together a number of separate domains into one framework.Finally, we will bring together the two closely related literatures of mobility within and across generations for the first time to explore what appears to be contrasting findings. The intragenerational mobility literature has found evidence of increased earnings mobility as people age for a recent cohort of people. In contrast, the intergenerational mobility literature has documented how these people experienced less mobility in terms of their family background. We will use our methodological advancements from the second research project to consider both types of mobility in a consolidated framework, describing how these apparently contrasting findings can work together. This will be new and informative work for understanding how family background relates not only to later life outcomes but also to inequality and mobility later in life. Given the current high political interest in this subject area, we believe that this research will not just be a substantive advance on the academic literature but will have a substantial wider impact in the media and in policy development.