Job Market Paper:
Instrumental Variable Approach to Intergenerational Mobility in Income: Evidence from Indonesia
Abstract: By 2030, more than 85 percent of the world’s population will be living in the developing world. Yet there is very little evidence on intergenerational mobility (IGM) for these countries. In this paper, we use multiple waves of the Indonesian Family Life Survey (IFLS) to estimate both absolute and relative IGM in income and consumption expenditure for Indonesia. Our estimates of IGM range from 0.08 to 0.62 as we use a more permanent measure of income and correct for measurement error bias. OLS estimate of relative income mobility is 0.08 suggesting high mobility, however, the preferred IV estimates that account for measurement error bias in income increases the elasticity coefficient to 0.456, indicating substantially lower mobility. We find low mobility using per capita consumption expenditure indicating lower mobility than what OLS estimates of income show. We also examine absolute mobility that specifically captures the extent of upward and downward mobility in income and consumption expenditure. At 20th and 40th percentiles of parental income distribution the elasticity estimate is 0.27 and 0.77 respectively. These estimates suggests lower upward mobility for their children. This paper shows that even in the absence of tax records, household survey data on income and consumption available from developing countries can facilitate mobility estimates. Our results are robust to sample attrition, choice of controls, functional form specification, and household composition.
Works in Progress:
Multi-generational Education Mobility in Indonesia
Abstract: This paper is the first to provide evidence on multi-generational mobility in education for Indonesia, that is, measures changes in child’s education relative to both parent and grandparent. Using the Intercensal Survey of Indonesia (SUPAS) I find education persistence of 0.45 between father and child and 0.27 between grandchild and grandfather. Estimates show lower education persistence between grandchild and grandfather. My findings do not show any gender difference in education mobility in Indonesia. I also estimate the impact of the Indonesian Primary School Construction (INPRES) on education mobility, results show that children exposed to INPRES experienced higher education mobility. This paper contributes to the existing literature by providing evidence on multi-generational education mobility in Indonesia using multiple data sets. Evidence from this paper also suggests that policy interventions like INPRES can be promising in facilitating education mobility.
Labor Market Returns to Big Five Personality Traits: Evidence from Indonesia (with Subha Mani & Helene Purcell)
Abstract: There is quite a bit of evidence on the returns of non-cognitive skills/personality traits from developed countries, and common sense view suggests that these socio-emotional traits must also be important for explaining life outcomes in developing countries, though the empirical evidence remains scarce. The objective of this paper is to contribute evidence on the economic returns to Big Five personality traits using large-scale household survey data from Indonesia. We use data from multiple waves of IFLS to estimate causal relationship between Big Five personality traits and labor market outcomes.