Educational Mobility Across Multiple Generations in Indonesia

Abstract

Standard intergenerational measures have been shown to understate the long-run persistence of socioeconomic advantages in developed countries. We study theoretically and empirically whether this pattern extends to less developed settings, using Indonesia as a case study. Using the Indonesian Family Life Survey (IFLS) and Census data, we study multigenerational correlations in education across three generations. Contrary to previous findings, we observe greater multigenerational mobility than parent-child correlations alone would suggest. We develop a theoretical framework to highlight two key factors influencing multigenerational dynamics in developing countries: (1) financial and credit constraints, and (2) cultural norms related to marital sorting. To confirm their relevance, we exploit regional variations in exposure to the 1997-98 Asian financial crisis and in marital customs.