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Intergenerational income mobility trends in Canada

Author

Listed:
  • Marie Connolly
  • Catherine Haeck
Abstract
We document the rise the intergenerational transmission of income using newly updated administrative Canadian tax data for children born between the early 1960s and the mid‐1980s. We show that children whose parents were in the bottom income quintile have become less likely to exit the bottom quintile once in adulthood and less likely to transition into the middle class. Declining mobility is observed both at the national and provincial level. While federal and provincial policy‐makers should worry about the rise in the strength of the poverty trap, the impact of recent policy developments on children that have yet to become adults remains to be documented. Nous documentons l'augmentation de la transmission intergénérationnelle des revenus en utilisant des données fiscales administratives canadiennes récemment mises à jour pour les enfants nés entre le début des années 1960 et le milieu des années 1980. Nous montrons que les enfants dont les parents se situaient dans le quintile inférieur de revenu sont moins susceptibles de quitter le quintile inférieur une fois adultes et moins susceptibles de passer dans la classe moyenne. Le déclin de la mobilité est observé tant au niveau national qu'au niveau provincial. Alors que les décideurs politiques fédéraux et provinciaux devraient s'inquiéter de la montée en puissance de la trappe de pauvreté, l'impact des changements récents de politiques sur les enfants qui n'ont pas encore atteint l'âge adulte reste à documenter.

Suggested Citation

  • Marie Connolly & Catherine Haeck, 2024. "Intergenerational income mobility trends in Canada," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 57(1), pages 5-26, February.
    • Handle: RePEc:wly:canjec:v:57:y:2024:i:1:p:5-26
    DOI: 10.1111/caje.12699
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    References listed on IDEAS

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