Bringing the parents back in: The effect of social origins on sectoral allocation and earnings

Research on the effect of family origin, especially sectoral origin, on sectoral allocation and the process of earnings determination is virtually nonexistent. This paper attempts to fill this gap. A logit analysis of OCG-II data reveals that father’s sector of employment (but not his occupational status or education) affects son’s placement in the dual economic structure such that men whose fathers work in the core are significantly more likely to be allocated to this sector. It is also shown that father’s sector of employment and occupational status have significant effects on earnings of sons and that father’s sector is a stronger predictor of earnings than respondent’s sector. Finally, it is argued that economic structure plays an important role in the intergenerational transmission of opportunity.