Institutional Change and Parental Compensation in Intergenerational Attainment

Heta Pöyliö, Jani Erola & Elina Kilpi-Jakonen

Abstract

Previous research has shown how institutional changes, such as educational expansion, have weakened parental influence on educational attainment. We extend this analysis to occupational attainment and put forth a parental compensation hypothesis: as the origin-education (OE) association weakens, parents act to compensate for this in order to maintain their influence on the child’s occupational attainment. We should see this as a strengthened origin-destination association net of education (net OD). Further, we study whether these compensatory actions are triggered by changes in educational institutions and whether the institutional changes that reduce educational inequality are the same ones that prompt parental compensation. We have linked data from five waves of the European Social Survey (2002-2010) with data on educational institutions matched to birth cohorts born 1941-1980 in 25 countries. Using linear country fixed effect models, we find weakened OE and strengthened net OD associations, supporting our parental compensation hypothesis. In addition, decomposition results show that reforms lengthening compulsory education have had a rather strong direct influence on parental compensation, whereas reforms in higher education have not been influential. As a conclusion, a later school leaving age seems to secure increased parental influence on children’s occupational attainment, while parents do not seem to have acted directly on the changes in higher education.