TY - JOUR
T1 - Sorting and long-run inequality
AU - Fernández, Raquel
AU - Rogerson, Richard
N1 - Funding Information:
* We thank Alberto Alesina and two anonymous referees for helpful suggestions. We also thank Michael Kremer, Nezih Guner, John Knowles, Victor Rios-Rull, and seminar participants at numerous conferences and universities. We thank Dan Levy for his research assistance. The authors gratefully acknowledge support from the National Science Foundation, and the first author also thanks the C. V. Starr Center for financial support.
PY - 2001/11
Y1 - 2001/11
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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U2 - 10.1162/003355301753265589
DO - 10.1162/003355301753265589
M3 - Article
AN - SCOPUS:0035613157
SN - 0033-5533
VL - 116
SP - 1305
EP - 1341
JO - Quarterly Journal of Economics
JF - Quarterly Journal of Economics
IS - 4
ER -