Intergenerational mobility and the role of aspirations

Raising aspirations of children and their carers is a necessary condition for upward social mobility.

By Warn N. Lekfuangfu

Based on research by Warn N. Lekfuangfu and Reto Odermatt 

Intergenerational mobility is an important topic of policy discussion around the world. Labour market success and, in turn, intergenerational mobility are commonly understood to be driven by capabilities and constraints, for instance, innate ability, financial endowments and available opportunities (Corak 2013, Elliot Major and Machin 2018, Kourtellos et al. 2020). More recently, a new set of research has shed light on a specific form of ‘internal constraints’, which may induce people to form biased subjective beliefs about the capabilities in different life domains (Ray 2006). As subjective beliefs are known to influence actual decisions (Manski 2004, Attanasio and Kaufmann 2014, Delavande and Zafar 2019), these psychological constraints can hinder later life successes – by leading some people to make sub-optimal investments and outcomes (Boneva and Rauh 2018, Dizon-Ross 2019, Papageorge et al. 2020).

Particularly in the context of intergenerational mobility and human capital development, parents with different subjective beliefs also invest differently – both in terms of parental time spending and physical resources. In my recent paper (Lekfuangfu et al. 2018), I show that parents who believe in lower returns to their activities with their children also spend less productive time with their children, and this subsequently led to worse educational achievements of their offspring. More importantly, such biased beliefs of parents are more profound among lower socioeconomic (SES) households. More alarmingly, subjective beliefs can also be transmitted intergenerationally (Goux et al. 2017, Carlana et al. 2022). Therefore, if parental subjective beliefs are biased, and such biases are more prevalent among less privileged families, upwards social mobility will be more challenging. Together with constraints of time and financial resources that some low-income parents are already facing, biased beliefs would further limit their investments in children and subsequently lead to lower education, income, and health outcomes of their children and the next generations. The prevalence of inequality transmission across generations calls for policies to reduce the disparity of resources and opportunities from very young ages.

In this blog article, I will draw attention at a type of subjective beliefs: aspirations, defined as ‘one’s capability to entertain ideal goals or ambitions for the future that may or may not be within the range of one’s situation’ (La Ferrara 2019). Recent theoretical insights show that aspirations are another key driver of social mobility (Dalton et al. 2016, Genicot and Ray 2017, 2020). Aspirations are motivational and they shape actual achievements later in life by raising effort levels and investment decisions. In addition, such behavioural biases due to internal constraints prevent certain individuals from inserting more effort when it is in fact possible (Dalton et al. 2016). Put into the context of social inequality, people’s ‘capacity to aspire’ may be dictated by their SES strata (Appadurai 2004). Families from lower-income positions may have different reference points (‘aspiration window’) and therefore set much lower perceived attainable goals and subsequently suffer from ‘aspiration traps’. If aspirations are also transmitted intergenerationally, this also means that young adults from lower SES would systematically have lower aspirations and subsequently attain lower occupational and educational outcomes. How much does economic status dictate the children’s capability to set their dreams, and how influential are the parents? These questions are important for any policies that aim to tackle the issue of inequality of opportunities. Moreover, to what extent do childhood aspirations matter to later life successes?

These are the key questions that my recent work with Reto Odermatt aims to shed more light on (Lekfuangfu and Odermatt, 2020). The design of our analysis exploits a unique dataset of British cohorts born in 1958 (the National Childhood Development Study of 1958). We are able to track the life course of over 10,000 individuals from birth up to age 60. This allows us to document the degree of educational and occupational inequalities – not only in the cross-section (among cohort members), but also in the intergenerational manner (how far one’s achievement is dictated by one’s parent). Four main insights stand out:

Children do dare to dream – their ideal goal is less dependent on their socio-economic status, in comparison to the actual jobs that they ended up doing.  There are differences in aspirations (‘ideal jobs you would wish to do’) across children from different SES backgrounds. We also propose an alternative measure of intergenerational mobility by looking at the relationship between a child’s aspirations (stated at age 16) and those of the parents (see Figure 1 for occupation). Aspirations for the future are less constrained by their contemporary economic status than the actual achievements later in life. This illustrates evidence for ‘aiming higher’ – that is the jump of their aspirations away from their parent’s status, which is much more pronounced among teenagers from lower SES backgrounds. A similar pattern is also observed when we look at educational aspiration (Figure 2)

Figure 1. Violin plots comparing aspired status, achieved status, and father’s occupation.

Notes: Violin plots of the CAMSIS occupation prestige score of father’s occupation (age 11) and cohort member’s aspired occupation (age 16) and realised occupation (age 50), for each quintile of father’s CAMSIS score. Violin plots combine box plots with kernel density plots, the white circles indicate the medians.

Yet, how far a child dreams, as well as the dream stated by their parents, remains firmly constrained by one’s position in society. Upward mobility remains yet limited even when in the eyes of a sixteen-year old’s perception of their idealistic future. Most of all, the formation of childhood aspirations is strongly influenced by parents’ aspirations, over and above own abilities, social status and family income. In particular, parents’ aspirations matter more to girls’ occupational aspirations; whereas class teachers’ view is important for boys’ educational aspirations.

Figure 2. The proportion of the NCDS sample who would like to have a college education (ages 7, 11 and 16) and actual attainment – by quintile of father’s occupational score

Notes: The proportions are weighted by the inverse probability of attrition in childhood survey waves. The confidence intervals are at a 95 % significance level. The first three sets of columns indicate aspirations at ages 7, 11 and 16. The final set of columns is the actual educational attainment of the cohort members. All statistics are reported by quintile of the father’s occupational CAMSIS score (when the cohorts aged 11).

Childhood aspirations matter to later-life achievement, over and above innate ability or financial barriers. Consequently, our findings indicate that low aspirations (both of the children and of their mentors, including parents and teachers), can lead to stalled social mobility. However, existing external constraints can harm those with high aspirations but lack resources. On the one hand, raising aspirations, particularly among lower SES families, is a necessary condition for mitigating social inequality. On the other hand, a discrepancy ‘gap’ between aspirations set since childhood and actual outcome realisation can lead to disappointment and subsequently reduce subjective well-being later in life (Ray 2006). We provide the first set of empirical evidence on this debate as we show how life satisfaction over the working life is influenced by these gaps. Particularly for males, our results highlight negative consequences when they do not reach the occupational outcomes aspired to in their lives. However, over the life cycle, the negative effects fade away. Instead, we detect gains in life satisfaction among those whose achievements go beyond their aspirations later in life.

Take-aways: In summary, we show that social inequality is prevalent and alarming, even in the context of ‘dreams’. The family that one is born into, and the society one lives in remain fundamentally strong factors that dictate how far one would achieve in life. So far, we have shown that childhood aspirations matter to later-life success. Therefore, if left unaccounted for, such a strong status gradient in childhood aspirations would undoubtedly hinder intergenerational mobility. Therefore, for policy interventions aiming to elevate social mobility to be most effective, it is essential that the program design must consider such psychological impacts of poverty on subjective beliefs – both in terms of expectations and aspirations.

About the authors:

Warn N. Lekfuangfu is an assistant professor of Economics at Universidad Carlos III de Madrid. She conducts RCTs to tackle limited aspirations and constrained mindsets among poor households.


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