Jo Blanden traces the evolution of CEP research on social mobility and its interaction with policy debate.

Jo Blanden

English

Research Papers in Economics

Bigide
O
n 23 June 2008, the
Prime Minister gave a
flagship speech to school
leaders in which he said
that ‘raising social
mobility in our country is a national
crusade in which everyone can join and
play their part’. In January 2009, his
government published a White Paper 
on social mobility.
The opposition parties share the desire
for more mobility, with Conservative
leader David Cameron pledging in
December 2006 to take ‘the banner of
sensible, centre-right reform’ to the
issue of social mobility and the Liberal
Democrats supporting their own
independent Social Mobility Commission.
The rise of social mobility up the policy
agenda has coincided with a series of high
profile studies from CEP researchers. As
Stephen Machin’s ‘big ideas’ article in the
previous issue of CentrePiece showed, 
CEP played an important role in describing
the evolution of cross-sectional wage 
and income inequality during the 1980s
and 1990s.
At the same time, related projects laid
the foundations for an enduring research
strand on intergenerational mobility. In
1997, Lorraine Dearden, Stephen Machin
and Howard Reed followed up influential
work in the United States by estimating
the extent to which sons’ and daughters’
earnings at age 33 are associated with
their father’s earnings for a cohort born 
in 1958. 
CentrePiece Winter 2008/9
6
In the third of CEP’s ‘big ideas’ series, Jo Blanden
traces the evolution of CEP research on social mobility
and its interaction with policy debate.
Intergenerational m
The rise of social
mobility up the
policy agenda has
coincided with a
series of high
profile studies from
CEP researchersas
obility
CentrePiece Winter 2008/9
7
The approach taken by economists 
to measuring intergenerational income or
earnings mobility is relative. The most
straightforward description of mobility
uses a ‘transition matrix’, which divides
the income distribution of the parents’
generation into equal-sized groups 
(usually fifths or quarters) and shows the
proportion of the next generation that
moves into a higher income group, the
proportion that goes down and the
proportion that stays the same.
Movement away from the starting
point is seen as mobility. Notice that in
using this approach, upward mobility
equals downward mobility; if some
children move up, others must go down. 
One of the problems with the
transition matrix is that it is unable to take
account of the extent of movements
within groups. If those moving from the
first to second quartile are just tipping
over the boundary between the two
groups, there is less mobility than if they
are moving into the middle or top of their
new group.
To overcome this limitation,
economists also adopt a regression
approach, which takes account of all the
mobility between generations. This
produces the ‘intergenerational elasticity’:
a result of 0.3 would say that on average
a 10% difference in income between two
sets of parents would be passed on as a
3% difference in income between their
children. This statistical approach is also
based on an entirely relative conception of
mobility; the amount of upward and
downward mobility balance. 
The research by Dearden et al (1997)
presented a picture of limited mobility in
the UK, with results similar to those for
the United States, although the study did
not make an explicit comparison. At
around the same time, CEP researchers
Paul Gregg, Susan Harkness and Stephen
Machin undertook a two-stranded project
for the Joseph Rowntree Foundation.
The first component of their study
used the Family Expenditure Survey to
conduct an extensive analysis of the time-
patterns of child poverty in the UK.
Unsurprisingly, given our knowledge of
what happened to the wage distribution
over this period, the child poverty rate had
risen sharply in the 1980s.
The second part of the study showed
how strongly family background
influenced children’s development and
later outcomes. This reinforced the
message from the intergenerational
mobility analysis that experiencing low
income in childhood could have a
profound impact on later achievement.
The Gregg et al (1999) analysis had a
powerful influence on future policy-
makers. At the time, the New Labour
government was finding its new policy
agenda, rejecting the ‘Old Labour’ values
of equality of outcome in favour of a new
focus on equality of opportunity.
The message from CEP research at the
turn of the century was that
intergenerational persistence in the UK
was substantial and that high rates of
child poverty painted a bleak picture for
the future of British children. It seemed
natural to put these two facts together to
ask a new research question: how had the
influence of parental background changed
as the rates of child poverty increased? 
With the release of reliable earnings
data from the 1970 British birth cohort in
2000, a comparison of intergenerational
mobility over time in the UK became
possible, comparing the 1970 cohort with
their counterparts born in 1958. Research
on these two cohorts measured the
association between the income of
parents (when their children were aged
16) and the earnings of children in their CEP’s 1999 analysis
had a powerful
influence at a 
time when the
government was
rejecting ‘Old
Labour’ values of
equality of outcome
in favour of a new
focus on equality 
of opportunityCentrePiece Winter 2008/9
8
early thirties. The association was found to
be stronger for the later cohort growing
up in the 1980s than for the first cohort
who grew up in the 1970s.
The message from these data was 
that the rise in inequality and child poverty
had coincided with a fall in social mobility.
This study was published in 2004 in a
book edited by Canadian economist 
Miles Corak. 
The finding that mobility had declined
was well-timed, with initial versions of the
findings (presented to the Royal Economic
Society at Warwick in 2002) attracting
widespread media attention. This interest
peaked in 2005 when the findings were
presented as a summary report for the
Sutton Trust.
The tendency of the media at the time
was to sum up the research with the
headline ‘Social mobility in the UK is
falling’. While convenient for newspaper
editors, this was actually misleading,
implying that the fall observed over the
12-year period in question continued over
the following 20 years. Researchers will
not be able to evaluate this properly for
another couple of decades, although a
recent follow-up study by Blanden and
Machin (2008) suggests that the degree of
mobility is unlikely to change between the
cohorts born in 1970 and 2000. There is
certainly no evidence at this stage of the
situation continuing to deteriorate. 
Hot on the heels of the finding that
intergenerational mobility had declined
came the search for insights into why this
had happened. Work by Jo Blanden,
Lindsey Macmillan and Paul Gregg sought
to discover more about this, using a
framework that considered the
relationship between parental income
and children’s earnings developing out of
a two-stage process.
First, parental income relates to
children’s characteristics, that is, those
with better off parents have more
education; and second, these
characteristics are rewarded in the labour
market, that is, those with a better
education earn more. Using the rich data
in the British cohorts, the study found that
the great majority of the increase in
intergenerational persistence could be
accounted for the strengthening of the
relationship between parental income and
children's performance throughout the
education system.
The results discussed above are all
based on relative income mobility; this is
certainly not the only measure of ‘social
mobility’. There is a long history in the UK
of measuring social mobility by observing
changes in social class within dynasties.
Social class has tended to be measured by
fairly large groupings of occupations (say
seven); as with the transition matrix
approach this may obscure substantial
amounts of mobility within classes.
Another issue is that there is clear
change in the social class structure over
time due to old occupations dying out and
new ones emerging. This means that
social class analysis can explore two
dimensions of social mobility. First,
absolute mobility considers the question
‘are individuals in better class occupations
than their parents?’ Second, relative
mobility is about the extent to which there
are movements between classes that are
not driven by the overall changes in the
class structure.
The sociologist John Goldthorpe (of
Nuffield College, Oxford) and co-authors
have been tracing the progress of social
class mobility in the UK and the rest of
Europe for several decades, in general
emphasising similarity across nations and
stability within them. Investigations by
Goldthorpe and Jackson (2007) and
Erikson and Goldthorpe (2008) of changes
in mobility using the 1958 and 1970
cohorts demonstrate that there has been
no change in relative mobility when social
class is used as the outcome measure.
The difference in results between the
sociological and economic approaches has
led to a lively and productive debate, with
the sociologists asserting that the
differences are due to weaknesses in the
measurement of family income in the
cohort studies. Using a number of
approaches, Blanden et al (2008)
demonstrate that measurement error is
not the issue. Instead, they explain the
results in terms of the large inequalities in
family income that are found within the
broad social class groupings used by
sociologists; in light of these, there is no
reason to suppose that the two
methodologies should find similar results. 
The dialogue between sociologists 
and economists has certainly helped to
sharpen the policy debate on mobility.
Many political speeches have made
reference to ‘social mobility’ without a
clear conception whether they are
referring to absolute or relative mobility, The central
message from data
on the 1958 and
1970 British birth
cohorts was that
the rise in
inequality and
child poverty had
coincided with 
a fall in social
mobilityCentrePiece Winter 2008/9
9
and mobility measured by income or social
class. With contributions from both
sociologists and economists, the recent
Cabinet Office discussion paper ‘Getting
On, Getting Ahead’ has helped to clarify
the meaning of social mobility and has
therefore set the scene for more
transparent policy-making in the White
Paper on social mobility. 
In June 2008, a number of CEP
researchers (both past and present)
attended the Sutton Trust and Carnegie
Foundation’s trans-Atlantic summit 
on social mobility in New York, an event
star-studded with top academics and
policy-makers.
Jo Blanden gave the opening
contribution, which compared the levels of
mobility across countries using a variety of
methodologies, emphasising what can be
learned from taking a multidisciplinary
approach, and demonstrating the
correlation between low levels of mobility
and high levels of income inequality.
Sandra McNally discussed the contribution
that schools policy could make to
promoting mobility, and Stephen Machin
appeared on the policy roundtable
alongside cabinet minister Ed Miliband. 
The New York summit was followed
by a one-day conference at CEP, which
presented some of the cutting-edge work
on intergenerational mobility currently
being carried out in Europe. Again, 
there was a strong policy focus to
proceedings. More information about the
discussion can be found in the previous
issue of CentrePiece. 
In conclusion, there has been a
justified focus on the finding that
intergenerational mobility fell in the UK
between the 1958 and 1970 cohorts.
But this is not the only contribution made
by CEP researchers to our understanding
of social mobility.
Indeed, CEP contributions predate this,
with our researchers being among the first
to document the strong association
between family background and later
achievements in the context of the UK’s
high child poverty rates. CEP contributions
have also moved the debate past the fall
in mobility, to investigate ‘what happened
next’, and to consider the relationship
between different measures of mobility
and what these might mean for policy. 
It is also clear that the research on
intergenerational mobility discussed here
relates closely to the work on cross-
sectional inequality reviewed in the
previous issue of CentrePiece. Our interest
in intergenerational mobility is in part
encouraged by the recognition of the 
UK’s high inequality levels and exceptional
child poverty rates.
More recent work has attempted to
understand more about the link between
inequality and mobility, both in terms of
how inequality may influence different
measures of social mobility, and more
profoundly whether greater inequality in a
nation leads directly to less social mobility.
Further reading
Jo Blanden (2008) ‘How Much Can We Learn
from International Comparisons of Social
Mobility?’, invited paper written for the
Sutton Trust summit on social mobility.
Jo Blanden,Alissa Goodman, Paul Gregg and
Stephen Machin (2004) ‘Changes in
Intergenerational Mobility in Britain’, in Miles
Corak (ed.) Generational Income Mobility in
North America and Europe, Cambridge
University Press.
Jo Blanden, Paul Gregg and Lindsey
Macmillan (2007) ‘Accounting for
Intergenerational Income Persistence:
Non-cognitive Skills,Ability and Education’,
Economic Journal 117: C43-60.
Jo Blanden, Paul Gregg and Lindsey
Macmillan (2008) ‘Intergenerational
Persistence in Income and Social Class:The
Impact of Within-class Inequality’, mimeo.
Jo Blanden and Stephen Machin (2008) ‘Up
and Down the Generational Income Ladder in
Britain: Past Changes and Future Prospects’,
National Institute Economic Review 205:
101-17.
Lorraine Dearden, Stephen Machin and
Howard Reed (1997) ‘Intergenerational
Mobility in Britain’, Economic Journal 107:
47-64.
Robert Erikson and John Goldthorpe (2008)
‘Income and Class Mobility between
Generations in Great Britain:The Problem of
Divergent Findings from the Data-sets of
Birth Cohort Studies’, mimeo.
John Goldthorpe and Michelle Jackson (2007)
‘Intergenerational Class Mobility in
Contemporary Britain: Political Concerns and
Empirical Findings’, British Journal of
Sociology 58: 526-46.
Paul Gregg, Susan Harkness and Stephen
Machin (1999) ‘Poor Kids:Trends in Child
Poverty 1968-1996’, Fiscal Studies 20(2):
163-87.
Paul Gregg and Stephen Machin (2000)
‘Childhood Disadvantage and Success and
Failure in the Labour Market’, in David
Blanchflower and Richard Freeman (eds)
Youth Employment and Joblessness in Advanced
Countries, University of Chicago Press.
CEP contributions
have moved the
debate past the fall
in mobility, to
investigate ‘what
happened next’ and
whether greater
inequality in 
a nation leads
directly to less
social mobility
Jo Blanden is a lecturer in economics at the
University of Surrey and a research associate
in CEP’s education and skills programme.

Big ideas: intergenerational mobility

http://cep.lse.ac.uk/pubs/download/cp270.pdf

Big ideas: intergenerational mobility

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