No. 1739: The Origins of Intergenerational Associations: Lessons from Swedish Adoption Data
published in: Quarterly Journal of Economics, 2006, 121 (3), 999-1028
We use unique Swedish data to estimate intergenerational associations between adoptees and their biological and adoptive parents. We argue that the impact from biological parents captures broad pre-birth factors, including genes and prenatal environment, and the impact from adoptive parents represents broad post-birth factors, such as childhood environment, for the intergenerational association in education and income. We find that both pre- and post-birth factors contribute to intergenerational transmissions, and that pre-birth factors are more important for mother's education and less important for father's income. We also find some evidence for a positive interaction effect between post-birth environment and pre-birth factors.