Occupational Mobility across Generations: a Theoretical Model with an Application to Italy

This paper proposes a simple theoretical model to identify the main determinants of intergenerational occupational mobility with an ap- plication to Italian data. We assume that occupational mobility is described by a Markov matrix and that three factor affect the occu- pational choice of an individual: the income incentives of each occu- pation, the family background and the occupational structure. The empirical application of the proposed model to a sample of Italian families describes Italy as a less mobile country, and in partic- ular we show that occupational mobility decreases for children born between 1966 and 1976. This result is due to the worsening of oppor- tunities. The estimate of three synthetic indexes confirms the decease of mobility.