Transformations  in
Business & Economics

WHAT AFFECTS THE INCOME GAP INTERGENERATIONAL TRANSMISSION?
Kangyin Lu, Manxue Chen, Liwen Jia

ABSTRACT. In 2017, the GINI coefficient of Chinese household income was 0.469, exceeding the international warning line (0.4), and increased in comparison to 2016. China's high income gap is transmitted from generation to generation, which will form a long-term problem of income inequality.
The purpose of this paper aims at using the micro-survey data and macro-statistical data to build an intergenerational income gap impact mechanism model, and through empirical method to estimate the role of personal factors, family factors and macroeconomic factors in the transmission of intergenerational income gap, so as to explore ways to promote intergenerational income mobility. The results show that the parents' income will affect the transmission of the intergenerational income gap; and the intergenerational income gap shows regional differences; the intergenerational income gap is different due to educational level of the parents; the participation of parents' pension insurance and medical insurance will affect the transmission of intergenerational income gap between father and son; the total annual income of father's family will have a significant positive impact on the intergenerational transmission of income gap; the impact of the total assets of the father's family on intergenerational income gap cannot be ignored; the macroeconomic development in the region where fathers live obviously affects the transmission of intergenerational income gap. 

KEYWORDS: income gap, intergenerational income mobility, intergenerational transmission, social inequality.

JEL classification: D01, D31, E24.