Abstract
Many social commentators have raised concerns over the possibility that increased sorting in society may lead to greater inequality. To investigate this, we construct a dynamic model of intergenerational education acquisition, fertility, and marital sorting and parameterize the steady state to match several basic empirical findings. We find that increased sorting will significantly increase income inequality. Four factors are important to our findings: a negative correlation between fertility and education, a decreasing marginal effect of parental education on children's years of education, wages that are sensitive to the relative supply of skilled workers, and borrowing constraints that affect educational attainment for some low-income households.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 1305-1341 |
| Number of pages | 37 |
| Journal | Quarterly Journal of Economics |
| Volume | 116 |
| Issue number | 4 |
| DOIs | |
| State | Published - 2001 |
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ASJC Scopus subject areas
- Economics and Econometrics
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Sorting and long-run inequality. / Fernandez, Raquel; Rogerson, Richard.
In: Quarterly Journal of Economics, Vol. 116, No. 4, 2001, p. 1305-1341.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - Sorting and long-run inequality
AU - Fernandez, Raquel
AU - Rogerson, Richard
PY - 2001
Y1 - 2001
N2 - Many social commentators have raised concerns over the possibility that increased sorting in society may lead to greater inequality. To investigate this, we construct a dynamic model of intergenerational education acquisition, fertility, and marital sorting and parameterize the steady state to match several basic empirical findings. We find that increased sorting will significantly increase income inequality. Four factors are important to our findings: a negative correlation between fertility and education, a decreasing marginal effect of parental education on children's years of education, wages that are sensitive to the relative supply of skilled workers, and borrowing constraints that affect educational attainment for some low-income households.
AB - Many social commentators have raised concerns over the possibility that increased sorting in society may lead to greater inequality. To investigate this, we construct a dynamic model of intergenerational education acquisition, fertility, and marital sorting and parameterize the steady state to match several basic empirical findings. We find that increased sorting will significantly increase income inequality. Four factors are important to our findings: a negative correlation between fertility and education, a decreasing marginal effect of parental education on children's years of education, wages that are sensitive to the relative supply of skilled workers, and borrowing constraints that affect educational attainment for some low-income households.
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UR - http://www.scopus.com/inward/citedby.url?scp=0035613157&partnerID=8YFLogxK
U2 - 10.1162/003355301753265589
DO - 10.1162/003355301753265589
M3 - Article
VL - 116
SP - 1305
EP - 1341
JO - Quarterly Journal of Economics
JF - Quarterly Journal of Economics
SN - 0033-5533
IS - 4
ER -