Anders Björklund

Is There a Glass Ceiling in Sweden

Using 1998 data, we show that the gender log wage gap in Sweden increases throughout the wage distribution and accelerates in the upper tail. We interpret this as a strong glass ceiling effect. We use quantile regression decompositions to examine whether this pattern can be ascribed primarily to gender differences in labor market characteristics or in the rewards to those characteristics. Even after extensive controls for gender differences in age, education (both level and field), sector, industry, and occupation, we find that the glass ceiling effect we see in the raw data persists to a considerable extent.

Income Inequality and Income Mobility in the Scandinavian Countries Compared to the United States

This paper compares income inequality and income mobility in the Scandinavian countries and the United States during 1980–90. The results suggest that inequality is greater in the United States than in the Scandinavian countries and that this inequality ranking of countries remains unchanged when the accounting period of income is extended from one to eleven years. The pattern of mobility turns out to be remarkably similar, in the sense that the proportionate reduction in inequality from extending the accounting period of income is much the same. But we do find evidence of greater dispersion of first differences of relative earnings and income in the United States. Relative income changes are associated with changes in labor market and marital status in all four countries, but the magnitude of such changes are largest in the United States.

Unemployment Shocks and Income Distribution: How did the Nordic Countries Fare during their Crises?*

We study the inequality of disposable income in Denmark, Finland, Norway and Sweden during the late 1980s and early 1990s when unemployment rose dramatically in all four countries. A standard measure of inequality - the Gini coefficient - was surprisingly stable in all countries during this period. By decomposing the Gini into income components, we test hypotheses about the reasons for this stable income distribution. Our most straightforward hypothesis, that rising unemployment benefits counteracted the impact of more unequally distributed earnings, receives only limited support. More complex mechanisms seem to have been at work.

How Reliable Are Register Data for Studies of the Return on Schooling? An Examination of Swedish Data.

Some important studies have recently used Statistics Swedens register data on educational levels and annual earnings to estimate the economic return on schooling. This is a powerful way of getting large samples and of adding information to data sets with other useful information. By using detailed information in the Level of Living Surveys, we investigate two potential flaws with this approach. First, the register data on education do not pick up some partial studies at high school and college which do not lead to formal degrees. Our results show that such studies have a significant positive economic return. Nonetheless, the use of this information as independent variables in regression models does not change the original estimates. So omission of partial studies does not flaw the results based on registers only. Second, also using the Level of Living Surveys, we compare estimates based on annual earnings as the outcome measure with those using hourly earnings. We find a marked difference, particularly for higher education levels. However, by eliminating observations with low earnings one gets results for annual earnings that are similar to those for hourly earnings.

Intergenerational income mobility in permanent and separated families

Abstract We focus on the father definition in studies of intergenerational income mobility. The association between sons’ income and their biological fathers’ income is weaker the less they lived together. We also find weaker associations for nonbiological fathers than for biological.

Parental Separation and Children's Educational Attainment: A Siblings Analysis on Swedish Register Data

This paper analyses whether the commonly found negative relationship between parental separation in childhood and educational outcomes is causal or due mainly to selection. We use data on about 100,000 Swedish full biological siblings, born in 1948-63, and perform cross-section and sibling-difference estimations. Outcomes are measured as educational attainment in 1996. Our cross-section analysis shows the expected negative and significant relationship, while the relationship is not significant, though precisely estimated, in the sibling-difference analysis. This finding was robust to the sensitivity tests performed and is consistent with selection, rather than causation, being the explanation for the negative relationship.

Equality of opportunity and the distribution of long-run income in Sweden

Equality of opportunity is an ethical goal with almost universal appeal. The interpretation taken here is that a society has achieved equality of opportunity if it is the case that what individuals accomplish, with respect to some desirable objective, is determined wholly by their choices and personal effort, rather than by circumstances beyond their control. We use data for Swedish men born between 1955 and 1967 for whom we measure the distribution of long-run income, as well as several important background circumstances, such as parental education and income, family structure and own IQ before adulthood. We address the question: in Sweden, given its present constellation of social policies and institutions, to what extent is existing income inequality due to circumstances, as opposed to ‘effort’? Our results suggest that several circumstances, importantly both parental income and own IQ, are important for long-run income inequality, but that variations in individual effort account for the most part of that inequality.

IQ and Family Background: Are Associations Strong or Weak?

Abstract For the purpose of understanding the underlying mechanisms behind intergenerational associations in income and education, recent studies have explored the intergenerational transmission of abilities. We use a large representative sample of Swedish men to examine both intergenerational and sibling correlations in IQ. Since siblings share both parental factors and neighbourhood influences, the sibling correlation is a broader measure of the importance of family background than the intergenerational correlation. We use IQ data from the Swedish military enlistment tests. The correlation in IQ between fathers (born 1951-1956) and sons (born 1966-1980) is estimated to 0.347. The corresponding estimate for brothers (born 1951-1968) is 0.473, suggesting that family background explains approximately 50% of a persons IQ. Estimating sibling correlations in IQ, we thus find that family background has a substantially larger impact on IQ than has been indicated by previous studies examining only intergenerational correlations in IQ.

Estimating the Return to Investments in Education: How Useful Is the Standard Mincer Equation?.

Abstract We examine how well the schooling coefficient in standard Mincer equations, estimated on Swedish data for 1968, 1981 and 1991, approximates the marginal internal rate of return to education. We find three cases where inference from the estimated schooling coefficient is misleading. First, the decline in return to schooling from 1968 to 1981 is mainly concentrated to college education, whereas the return to high school education is stable. Second, the rate of return is sensitive to the assumption made about the length of working life, or the retirement decision. Third, both the schooling coefficient and the internal rate of return give misleading information about the value of adult education. By comparing the present value of lifetime earnings between youth and adult education, we find large differences in favor of youth education, even though the schooling coefficient and the internal rate of return are the same.

The Output of the Swedish Education Sector

The output of the Swedish education sector is defined as the addition to lifetime incomes generated by the schooling system. Using cross-sectional information on wages, employment rates, working hours, school-participation and leisure time, all by years of schooling, we compute new output-based measures of the education sector. Measures that include and exclude leisure, and that are counted before and after taxes are computed for the years 1967, 1973, 1980 and 1990. Our most important conclusion is that the output-based measure differs so markedly from conventional input-based ones that a replacement of the latter with the former would change the picture of the overall performance of the Swedish economy over the period.