The Study On The Intergenerational Income Transmission Of Chinese Residents Based On Financial Assets

Intergenerational transmission of income refers to the income of adult to whatextent is determined by the income of their parents,which mainly measured throughintergenerational income elasticity. Intergenerational income elasticity reflects thedegree of intergenerational transmission, its value will directly affect the fairness of thewhole society by working hard to change the status quo.and thus have a significantimpact to social harmony and the society’s highly efficiency. Accordingly based on theinvestigation to the intergenerational income transitivity, explore the size of thetransitivity, trends, ways and mechanism, and to seek possible policies to reduceintergenerational income transitivity and improve social mobility,thus to enhancepeople’s sense of fairness and happiness and build a harmonious and efficient form ofsustainable economy is of great significance. The studies of intergenerational incometransfer in China starts not very early, the existing studies are mostly based on humancapital and family background,the importance of financial assets is not prominent,especially for the capital accumulation effect based on mortgage leverage point is notfully considered. Considering the implementation of housing marketization in China inthe late1990s, monetization reform and a series of major policy, consumer credit,especially the rapid rise of the housing credit business, residents’ income accumulation,income transfer mode with different characteristics begin to rise in the new era,therefore, study the intergenerational transmission of income effects and relatedmechanism in the new period has considerable practical significance.Our study is on the basis of existing research, expanding channels ofintergenerational transmission of income to financial assets, combined with presentdevelopment of financial market.In order to comprehensively analysis the role offinancial assets, human capital, social capital of residents in intergenerational incometransfer, at the same time, considering the financial leverage effect played in themortgage of the real estate market, thus it has a huge contribution to the stock of wealthbetween generation and intergeneration, and therefore the real estate mortgage market’simpact on income transfer, in particular, will further improve the existing relatedresearch about intergenerational income transfer in our country, this paper also based onthe transitivity preliminary estimate, the size of the whole society, and the comparisonof high and low income stratum analysis, in order to get convincing empirical testresults. In theoretical analysis section, intergenerational transmission of existing researchare reviewed in this paper, through the measure of the intergenerational income transfer,the degree of intergenerational income transfer, the influence of intergenerationalincome transfer mechanism and combined with the existing research on this aspect tothe systematic elaboration, on these basis refine control variable and the empiricalmodel in this paper.In the empirical analysis part, this article firstly analyze real estate market of ourcountry and the status of the mortgage market; Then empirical data was introduced indetail in this paper; Later based on the selection of financial assets, human capital,social capital among the three variables in the model we measure out the investmentcoefficient and the coefficient of returns for investments, and then sort out the empiricalresults.On the basis of existing researches, this article has several innovations as follows:first, from the reality of our country’s intergenerational income transmission, we takethe financial assets into consideration, such as family wealth and capital which havegreat impact on the income of children. Especially, we emphasize the importanceof the financial assets to intergenerational income transfer in our country. In this paper,we not only consider the sharply rise of real estate, we also consider the leverage effectof speculation in the mortgage market which may affect intergenerational incometransmission. Second, previous studies of intergenerational income mobility, the rigourof the processing data, the definition of income and so on are quite different, whichcause research conclusions unreliable, this article adopt the publicly available data,choosing important data, which have corresponding consistency, such as the use ofsalary income to reduce the error of the intergenerational transfer research, and thenmake the results more reliable.