7/31/2019 Gil Puyat

1/2

Gil Puyat

Econ 690

Prof. Potepan

Assignment 3B

Liu, Haoming, and Zeng Jinli. 2007. Genetic Ability and Intergenerational Earnings

Ability. Journal of Popular Economics (2009) 22:75-79.

Abstract

Intergenerational wage and earnings elasticities of adopted children compared to

non-adopted children suggest that inheritable ability plays an important role in passing on

parents earnings ability to their children. Regression results from kinship correlations

converge on the conclusion that differences in ability can explain a substantial fraction of

the variation in IQ. The authors claim that the differences in intergenerational wage

elasticity of adopted children are significantly lower than that of their non-adopted

counterparts.

Literature Review

In Liu and Zeng (2007), they examine the role of genetic ability in generating

strong positive role on intergenerational earnings in the U.S. The study finds the

differences between adopted and non-adopted childrens ability and its importance in

transmitting earnings ability from their parents. The authors measure IQ level and compare

them to kinship correlations. They summarize that about half of the variation in IQ among

individuals in the population can be explained by genetic ability.

7/31/2019 Gil Puyat

2/2

Behrman, Jere R., and Rosenzweig, Mark R. 2005. Parental Wealth and Adult

Childrens welfare in Marriage. The Revue of Economics and Statistics, August 2006,

88(3):496-509.

Abstract

Newly available data on parent and in-laws indicate that parental resources of marital

partners may affect resource distribution within marriage. Regression results from these

data sets show the effects of parent and in-law characteristics such as transfers, bequests,

and visits by parents and in-laws, have a large effect on childrens human capital, returns to

schooling, and earnings. The authors argue that parental wealth continues to augment

welfare of children into adulthood.

Literature Review

In Behrman and Rosenzweig (2005), the authors find that parental resources are

important in determining such factors as childrens human capital, returns to schooling, and

future earnings. They find that parental wealth has economic advantages for children even

as they become adults, as they tend to have more education, higher quality education, better

connections for jobs, and transfers from gifts or bequests. Thus, in addition to direct

income advantages which are facilitated by greater human capital investment, those with

wealthier parents enjoy additional consumption benefits.