School Finance Equalization Increases Intergenerational Mobility: Evidence from a Simulated-Instruments Approach

Biasi, Barbara

doi:10.3386/w25600

Cited by 18 publications

(10 citation statements)

References 53 publications

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“…A number of studies have used these measures in some form includingKearney and Levine 2016;Bailey et al 2017;Sharkey and Torrats-Espinosa 2017;Derenoncourt 2018;Figlio et al 2019;Rothstein 2019; Card, Domnisoru, and Taylor 2019; Davis et al 2019, Goodman andIsen, 2020;Biasi, 2020 andAaronson et al, 2021. …”

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confidence: 99%

Measuring Intergenerational Income Mobility: A Synthesis of Approaches

Deutscher¹,

Mazumder²

2021

SSRN Journal

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The literature on intergenerational income mobility uses a diverse set of measures and there is limited knowledge about whether these measures provide similar information and yield similar conclusions. We provide a framework to highlight the key concepts and properties of the different estimators. We then show how these measures relate to one another empirically. Our main analysis uses income tax data from Australia to produce a comprehensive set of empirical estimates for each of 19 different mobility measures at both the national and regional level. We supplement this analysis with other data that uses either within or between country variation in mobility measures. A key finding is that there is a clear distinction between relative and absolute measures both conceptually and empirically. A region may be high with respect to absolute mobility but could be low with respect to relative mobility. However, within broad categories, the different mobility measures tend to be highly correlated. For rank-based estimators, we highlight the importance of how the choice of the distribution used for calculating ranks can play a critical role in determining its properties as well as affect empirical findings. These patterns of results are important for policy makers whose local economy might fare well according to some mobility indicators but not others. * This article was prepared for the Journal of Economic Literature and is under review. We thank Steven Durlauf for helpful guidance and anonymous reviewers for their comments. We also thank Francisco Ferreira and Markus Jäntti for helpful comments and participants at the workshop on Aging, Family and Social Insurance in Solstrand, Norway and the ZEW Workshop on Social Mobility and Economic Performance for their feedback, and Aastha Rajan for excellent research assistance. This research uses data from the Australian Taxation Office. All findings, opinions and conclusions are those of the authors and do not necessarily represent the views of the Australian Government or any of its agencies. The views expressed here do not reflect those of the Federal Reserve Bank of Chicago or the Federal Reserve system or the Australian Treasury. The research plan was approved by the Australian National University Human Ethics Committee, protocol number 2017/832.

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confidence: 99%

Measuring Intergenerational Income Mobility: A Synthesis of Approaches

Deutscher¹,

Mazumder²

2021

SSRN Journal

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“…Given the little to no evidence on the implications of Medicaid for wealth among families with children, we use NLSY-C and simulated Medicaid eligibility data to examine the effects of expanded prenatal Medicaid eligibility in the 1980s on family wealth. Simulated Medicaid eligibility addresses potential sorting around the cutoff (Biasi 2019) and state-specific changes in economic or demographic characteristics, which could bias naïve estimates. We find that expanded Medicaid access increased family wealth in the form of savings in various types of accounts and in home mortgages.…”

Section: Discussionmentioning

confidence: 99%

“…For example, if the eligibility threshold increases, families with more education and financial knowledge could be near the eligibility cutoff and transfer assets to a friend or extended family member to allow them to meet the eligibility requirements. Simulated eligibility addresses potential bias that could be introduced by this type of sorting within states (Biasi 2019). Second, average eligibility among families in a given state varies with state economic measures.…”

Section: Approachmentioning

confidence: 99%

The Effects of State-Level Medicaid Coverage on Family Wealth

Jackson¹,

Agbai²,

Rauscher³

2021

RSF: The Russell Sage Foundation Journal of the Social Sciences

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cess to key resources necessary for healthy child development. Increased access to Medicaid may affect children both directly, via access to crucial health care, and indirectly by reducing family medical expenses, allowing them to increase their economic resources.Research documents direct positive effects of state-level Medicaid coverage on short and longer-term outcomes for child and adult health (Currie and Gruber 1996;Goodman-Bacon 2018;Miller and Wherry 2019). These effects are quite meaningful not only for children's health, but also for their broader educational progression and human capitalThe Effects of State-Level Medicaid Coverage on Family Wealth m a rgo t jackson , chIn y er e agba I, a nd emIly r auscher Jointly financed by the federal government and the states, Medicaid represents the second largest form of public-sector investment in children. Research documents direct positive effects of Medicaid on children's well-being, but little is known about the effects of Medicaid expansions on the wealth of families with children. Using state variation in Medicaid access during the prenatal and infant period, linked to longitudinal data from the children of National Longitudinal Survey of Youth 79, we ask whether state-level Medicaid generosity is associated with family wealth among families with children and whether these effects vary by parental education and race-ethnicity. We find that greater state-level Medicaid access is associated with a larger total amount held in savings and retirement accounts, as well as in mortgages. These effects are largely driven by non-Hispanic white families, and those with more highly educated mothers.

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“…Chetty and Hendren (2018b) use administrative tax record data to estimate the causal effects of US counties on children's education and other adulthood outcomes. Recent studies by Jackson et al (2016) and Biasi (2019) estimate the causal effects of local school funding on children's education and future earnings. More generally, our paper relates to a large literature that studies skill formation and optimal education policies, including Durlauf (2004), Cunha et al (2010), Fryer and Katz (2013), Abbott et al (2019), Daruich (2018), and many others.…”

Section: Related Literaturementioning

confidence: 99%

Saving the American Dream? Education Policies in Spatial General Equilibrium

Eckert

Kleineberg²

2021

SSRN Journal

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The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent. Policy Research Working Paper 9574Children's education and economic opportunities differ substantially across US neighborhoods. This paper develops and estimates a spatial equilibrium model that links children's education outcomes to their childhood location. Two endogenous factors determine education choices in each location: local education quality and local labor market access. This paper estimates the model with US county-level data and studies the effects of a school funding equalization on education outcomes and social mobility. The reform's direct effects improve education outcomes among children from low-skill families. However, the effects are weaker in spatial general equilibrium because average returns to education decline and residential and educational choices of low-skill families shift them toward locations with lower education quality. This paper is a product of the Development Research Group, Development Economics. It is part of a larger effort by the World Bank to provide open access to its research and make a contribution to development policy discussions around the world.

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School Finance Equalization Increases Intergenerational Mobility: Evidence from a Simulated-Instruments Approach

Cited by 18 publications

References 53 publications

Measuring Intergenerational Income Mobility: A Synthesis of Approaches

Measuring Intergenerational Income Mobility: A Synthesis of Approaches

The Effects of State-Level Medicaid Coverage on Family Wealth

Saving the American Dream? Education Policies in Spatial General Equilibrium

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