Intergenerational income mobility and returns to education in Southern Brazil

This study analyzes intergenerational income mobility in Southern Brazil. Previous research has demonstrated that Brazil continues to be one of the least mobile countries in the world; however, the country has experienced strong socioeconomic advances in recent decades that may have affected mobility. The use of data from the 1982 birth cohort in the city of Pelotas, in the extreme south of Brazil, makes this one of the first studies to estimate mobility using direct observations of parental and filial income in Brazil. Using various estimation techniques, the results reveal relatively high income mobility compared with past Brazilian standards. Mobility is higher for nonwhites, extremely similar across genders, and higher among the poor. The findings indicate that increased government investment in education and reduced returns to education in recent decades are possible channels.