The Effect of Parental Wealth on Educational Decisions (Wealth and Education)

Taking a life-course perspective, we will analyze the effect of parental wealth, measured as net worth, on three educational transitions in Germany: 1) the transition from primary to secondary school, 2) transitions within secondary school, and 3) transitions after successful completion of higher secondary school. We will empirically test a number of hypotheses that we derive for example from the subjective expected utility (SEU) model applying multinominal logistic regressions, sequence analysis and methods of event history analysis. The specific contribution of our project will be threefold. First, we will empirically test whether parental wealth has an independent effect on educational decisions; second, we will amplify and test a set of potential causal mechanisms linking these two measures; and third, we will test for the heterogeneity of the parental wealth - educational decisions relationship across the wealth distribution.