Nature, nurture, and intergenerational mobility

Per Engzell, Felix Tropf 26 January 2020

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Governments worldwide invest considerably in human development by supporting public education, health care, and child support. One motivation for this funding is the ideal of equal opportunity: accidents of birth should not keep individuals from realising their full potential. To assess whether such policies achieve their aim, economists and others have studied intergenerational mobility – the extent to which people's social or economic status depends on that of their parents – and how it varies across space and time. Their research has found increased mobility in societies with liberal social policies and more equal access to high-quality education and healthcare (Blanden 2013, Corak 2013, Narayan et al 2018).

While this research is suggestive of relevant policy differences, sceptics have always been able to dismiss it on equality-of-opportunity grounds. According to one line of reasoning, greater inequality in countries like the US exists not because the playing field is less equal, but rather because the stakes are higher. Perhaps unequal countries simply put a premium on exceptional abilities – traits that also happen to be largely inherited? If egalitarian countries reward such traits to a lesser extent, equalisation may occur at the expense of other values, such as promoting those most qualified. In our recent work (Engzell and Tropf 2019), we combine intergenerational mobility research with data on groups of twins to test this objection. We focus on the transmission of educational attainment, for which cross-national data are readily available. 

Twin studies compare outcomes for fraternal and identical twins to partition variance into genetic influences (h² or ‘heritability’), other factors that siblings share (c²), and a residual term (e²). We know from such studies that inherited abilities play a role in educational attainment, but less is known about how this might vary by policy context. Economists have been sceptical about the use of twin studies to inform policy, and rightly so: poor eyesight may be 100% genetic, but eyeglasses will still be an effective remedy (Goldberger 1979). Nevertheless, inspecting how these decompositions vary cross-nationally can provide insights beyond the intergenerational correlations that have informed policy thus far.

Our findings

We begin by looking at intergenerational mobility. In Figure 1 we plot the parent-to-child correlation in years of schooling for sons and daughters born in the 1940s–1980s in ten countries, using recent estimates from the World Bank (2018). A lower correlation implies more intergenerational mobility. These results confirm previous literature: educational mobility increased in the past and is higher in Northern Europe and Australia – places with liberal welfare states – than in the US or Southern Europe (Narayan et al 2018).

Figure 1 Increasing intergenerational mobility

Notes: The graph shows the parent-to-child correlation in years of schooling by child’s gender and decade of birth for ten countries: Australia (AUS), Denmark (DNK), Finland (FIN), Germany (DEU), Italy (ITA), Norway (NOR), Spain (ESP), Sweden (SWE), United Kingdom (GBR), United States (USA).

In Figure 2 we link these trends to data from nearly 50,000 twins (Branigan et al. 2013) to test how the balance of ‘nature’ and ‘nurture’ depends on the policy context. In societies with low mobility, where schooling is strongly transmitted from parent to child, the environmental channel becomes relatively more important. Conversely, in egalitarian systems where the influence of family background is less pronounced, genetic factors gain explanatory power. There is thus nothing to suggest that the higher intergenerational persistence in unequal societies has anything to do with a higher influence of inherited character traits. Instead, we find that genetic influences are most pronounced in societies with more mobility.

Figure 2 In societies where the intergenerational correlation in years of schooling is lower, and mobility therefore higher, the relative explanatory power of genetic endowment (h²) is higher, while that of shared sibling environment (c²) is lower

Note: Superimposed lines show the least-squares line of best fit with 95% confidence intervals indicated by shaded areas. Marker labels encode the country and decade of birth for each cohort.

Heritability reflects the proportion of variance attributable to genetic factors, and if it is higher in some places this may mean two different things. Either genetics matter more in an absolute sense – that is, a lucky draw in the genetic lottery has a higher ‘return’ measured in years of schooling; but higher heritability can also occur if environmentally induced variance is lower, which would raise the relative contribution of genetics mechanically. In our study (Engzell and Tropf 2019), we show that the latter explains the apparent importance of genes in egalitarian societies: the influence of shared family environment is lower. Thus, mobility appears to be limiting the dis-equalising influences of the family while leaving genetic factors intact.

Conclusion

Economists study intergenerational mobility to track inequality of opportunity. Sceptics have argued that inheritance is driven by traits that predispose individuals to success, not the opportunities to realise those traits. We show that this objection does not hold up against data. Instead, it is in places where institutions promote mobility that genetic factors have the greatest explanatory power. With improved opportunities, the influence of family environment fades and leaves a greater proportion of variation attributable to genetic factors. Thus, while genes and environment both influence education, variation in intergenerational mobility is linked to social inheritance, not genes. Where there is less mobility, better-off parents can help their children by other means. 

References

Blanden, J (2013), “Cross-country rankings in intergenerational mobility: A comparison of approaches from economics and sociology”, Journal of Economic Surveys 27(1): 38-73.

Branigan, A R, K J McCallum and J Freese (2013), “Variation in the heritability of educational attainment: An international meta-analysis”, Social Forces 92(1): 109-140.

Corak, M (2013), “Income inequality, equality of opportunity, and intergenerational mobility”, Journal of Economic Perspectives 27(3): 79-102.

Engzell, P F and Tropf (2019), “Heritability of education rises with intergenerational mobility”, Proceedings of the National Academy of Sciences 116(51): 25386-25388. https://doi.org/10.1073/pnas.1912998116

Goldberger, A S (1979), “Heritability”, Economica 46(184): 327-347.

Narayan, A, R Van der Weide, A Cojocaru, C Lakner, S Redaelli, D G Mahler, R G N Ra-masubbaiah and S Thewissen, S (2018), Fair progress? Economic mobility across generations around the world, Washington, DC: World Bank.

World Bank (2018), “Global Database on Intergenerational Mobility (GDIM)”, Development Research Group. Washington, DC: World Bank Group.

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Topics:  Frontiers of economic research

Tags:  nature versus nurture, Intergenerational Mobility, family

Postdoctoral Prize Research Fellow, Nuffield College, University of Oxford

Assistant Professor in Social Science Genetics, CREST-ENSAE

CEPR Policy Research