nep-dem New Economics Papers
on Demographic Economics
Issue of 2012‒11‒11
thirty-six papers chosen by
Clarence Nkengne Tsimpo
University of Montreal and World Bank Group

  1. Selection and the Marriage Premium for Infant Health By Kasey S. Buckles
  2. A New Color in the Picture: The Impact of Educational Fields on Fertility in Western Germany By Anja Oppermann
  3. The effect of long term subsidies on female labor supply and fertility By Evelyn Korn; Matthias Wrede
  4. The Economics and Politics of Women's Rights By Matthias Doepke
  5. The U.S. Employment-Population Reversal in the 2000s: Facts and Explanations By Robert A. Moffitt
  6. Gender Differences in Competitive and Non Competitive Environments: An Experimental Evidence By David Masclet; Emmanuel Peterle; Sophie Larribeau
  7. Implications of Projected Philippine Population Growth, Age Structure Change, and Aging: Using National Transfer Accounts Results By Salas, J.M. Ian S.; Abrigo, Michael Ralph M.; Racelis, Rachel H.
  8. How Distance to a Non-Residential Parent Relates to Child Outcomes By Rasmussen, Astrid Würtz; Stratton, Leslie S.
  9. Does Mother Know Best? Parental Discrepancies in Assessing Child Functioning By Datta Gupta, Nabanita; Lausten, Mette; Pozzoli, Dario
  10. Does Mother Know Best? Parental Discrepancies in Assessing Child Functioning By Nabanita Datta Gupta; Mette Lausten; Dario Pozzoli
  11. Gambling on Genes: Ambiguity Aversion Explains Investment in Sisters’ Children By Brishti Guha
  12. Demographic Patterns and Household Saving in China By Steven Lugauer; Nelson Mark
  13. How Does Child Labor Affect the Demand for Adult Labor? Evidence from Rural Mexico By Kirk Doran
  14. The Role of Household Saving in the Economic Rise of China By Richard Jensen; Steven Lugauer
  15. The Mean Lifetime of Famous People from Hammurabi to Einstein By David de la Croix; Omar Licandro
  16. Female Labour Force Participation in Arab Countries: The Role of Identity By Tobias Caris; Bernd Hayo
  17. Implications of Philippine Trends in Education Financing and Projected Change in School-age Population on Education Expenditures by Income Group: Using National Transfer Accounts Results By Salas, J.M. Ian S.; Abrigo, Michael Ralph M.; Racelis, Rachel H.
  18. Parents Transmit Happiness along with Associated Values and Behaviors to Their Children: A Lifelong Happiness Dividend? By Headey, Bruce; Muffels, Ruud; Wagner, Gert G.
  19. Do Women Avoid Salary Negotiations? Evidence from a Large Scale Natural Field Experiment By Andreas Leibbrandt; John A. List
  20. The Effects of Employment Uncertainty and Wealth Shocks on the Labor Supply and Claiming Behavior of Older American Workers By Hugo Benitez-Silva; J. Ignacio Garcia-Perez; Sergi Jimenez-Martin Author-Email:
  21. Muslims in France: Identifying a Discriminatory Equilibrium By Adida, Claire L.; Laitin, David D.; Valfort, Marie-Anne
  22. Reducing Underage Alcohol and Tobacco Use: Evidence from the Introduction of Vertical Identification Cards By Bellou, Andriana; Bhatt, Rachana
  23. Filipino Elderly Living Arrangements, Work Activity, and Labor Income as Old-age Support By Salas, J.M. Ian S.; Abrigo, Michael Ralph M.; Racelis, Rachel H.
  24. Gender and Risk Taking in the Classroom By Justine Burns; Simon Halliday; Malcolm Keswell
  25. Does Schooling Improve Cognitive Functioning at Older Ages? By Schneeweis, Nicole; Skirbekk, Vegard; Winter-Ebmer, Rudolf
  26. Early Life Adversity and Children's Competence Development: Evidence from the Mannheim Study of Children at Risk By Dorothea Blomeyer; Katja Coneus; Manfred Laucht; Friedhelm Pfeiffer
  27. The Role of Land Certification in Reducing Gender Gaps in Productivity in Rural Ethiopia By Bezabih, Mintewab; Holden, Stein; Mannberg, Andrea
  28. Impact of Population on Environment in Madurai District By T., MAHESWARI
  29. Indiscriminate Discrimination: A Correspondence Test for Ethnic Homophily in the Chicago Labor Market By Nicolas Jacquemet; Constantine Yannelis
  30. Ethnic Inequality By Alberto Alesina; Stelios Michalopoulos; Elias Papaioannou
  31. Ethnic Inequality By Alberto F. Alesina; Stelios Michalopoulos; Elias Papaioannou
  32. Estimating Population Dynamics without Population Data By Robert Chambers; Vangelis Tzouvelekas
  33. Stochastic modeling of financing longevity risk in pension insurance By Ronkainen , Vesa
  34. Immigration and Economic Growth: Do Origin and Destination Matter? By Kang, Young ho; Kim, Byung Yeon
  35. Könslönegap och glastak - En studie av kvinnor och män i ekonomyrket By Löfström, Åsa
  36. Proyección de Pensión Personalizada en Chile: Evaluación de su impacto By Jorge Miranda Pinto

  1. By: Kasey S. Buckles (Department of Economics, University of Notre Dame)
    Abstract: Previous research has found a positive relationship between marriage and infant health. However, it is unclear whether this relationship is causal or a reflection of positive selection into marriage. In this paper, we use multiple empirical approaches to address this issue. First, we use the rich set of information available in the Natality Detail Files to control for selection into marriage along observable characteristics. We use a technique developed by Gelbach (2009) to determine the relative importance of different covariates, and show how selection into marriage has changed over time. Second, we construct a matched sample of children born to the same mother and exploit individual-level variation in marital status at birth. We apply fixed-effects and first-differences techniques to this matched sample to account for time-invariant unobserved characteristics. We find evidence of a sizable marriage premium. However, the premium fell by over 40% between 1989 and 2004, largely as a result of declining selection into marriage by race. Accounting for selection reduces OLS estimates of the marriage premiums for birth weight, prematurity, and infant mortality by at least half.
    Keywords: Marriage, Infant Health
    JEL: J13 J12
    Date: 2012–07
  2. By: Anja Oppermann
    Abstract: The extensive research on the impact of educational attainment on fertility behavior has been expanded by a new dimension. According to these recent findings, not only the level but also the field of education has to be taken into account. The field of education determines a great deal about labor market options and influences opportunities to combine employment and family life. The question this paper aims to answer is: How does the educational field influence the transition to parenthood of women and men in Western Germany? The German Socio Economic Panel (1984-2010) provides the data. Discrete time event history models are applied to examine the impact of the field of education on the transition to parenthood, looking at the time after graduation until a first child is born. Educational fields are grouped according to their most salient characteristic with regard to the share of women, the occupational specificity, the share of public-sector employment, and the share of part-time employment among people educated in the field. The models take the educational level into account and control for marital status, episodes of educational enrollment, and migration background. The results show that educational fields matter for the transition to a first birth only for women. For men, the results do not show a significant impact of educational fields on the transition rates to parenthood. However, they point at the importance of the educational level for the probability of men to become fathers. High transition rates are found among women educated in both female-dominated and male-dominated fields. The finding of low transition rates among women educated in public-sector fields come as a surprise, since, given the high workplace security in the public sector, they were expected to be among the women with high transition rates.
    Keywords: field of education, level of education, fertility, childlessness, Western Germany
    JEL: J12 J13 J16 I24
    Date: 2012
  3. By: Evelyn Korn (University of Marburg); Matthias Wrede (University of Erlangen)
    Abstract: Fertility and the provision of long-term care are connected by an aspect that has not received attention so far: both are time consuming activities that can be produced within the household or bought at the market and are, thus, connected through the intertemporal budget constraint of the household that accounts for time and money. This paper models that link and analyzes the effect of intervention in the long-term- care market on female labor-market related decisions. It shows that women’s fertility as well as their labor supply when young are affected by such policies. The overall effect can be decomposed into an opportunity-cost effect and a consumption-smoothing effect that each impact fertility as well as labor supply in opposite directions. Using European survey data, the paper shows that the consumption-smoothing effect is dominant
    Keywords: long-term care, child care, female labor supply, fertility
    JEL: J13 D91
    Date: 2012
  4. By: Matthias Doepke (Northwestern University)
    Abstract: Women's rights and economic development are highly correlated. Today, the discrepancy between the legal rights of women and men is much larger in developing compared to developed countries. Historically, even in countries that are now rich women had few rights before economic development took off. Is development the cause of expanding women's rights, or conversely, do women's rights facilitate development? We argue that there is truth to both hypotheses. The literature on the economic consequences of women's rights documents that more rights for women lead to more spending on health and children, which should benefit development. The political-economy literature on the evolution of women's rights finds that technological change increased the costs of patriarchy for men, and thus contributed to expanding women's rights. Combining these perspectives, we discuss the theory of Doepke and Tertilt (2009), where an increase in the return to human capital induces men to vote for women's rights, which in turn promotes growth in human capital and income per capita.
    Date: 2012
  5. By: Robert A. Moffitt
    Abstract: The decline in the employment-population ratios for men and women over the period 2000-2007 prior to the Great Recession represents an historic turnaround in the evolution of U.S. employment. The decline is disproportionately concentrated among the less educated and younger groups within the male and female populations and, for women, disproportionately concentrated among the unmarried and those without children. About half of men’s decline can be explained by declines in wage rates and by changes in nonlabor income and family structure influences, but the decline among women is more difficult to explain and requires distinguishing between married and unmarried women and those with and without children, who have each experienced quite different wage and employment trends. Neither taxes nor transfers appear likely to explain the employment declines, with the possible exception of the Supplemental Nutrition Assistance Program. Other influences such as the minimum wage or health factors do not appear to play a role, but increases in incarceration could have contributed to the decline among men.
    Date: 2012–10
  6. By: David Masclet (University of Rennes1 - CREM UMR CNRS 6211, France and CIRANO, Montréal, Canada); Emmanuel Peterle (University of Rennes 1 - CREM UMR CNRS 6211, France); Sophie Larribeau (University of Rennes 1 - CREM UMR CNRS 6211, France)
    Abstract: We present a new experimental design that permits us to explore gender differences in both performance and compensation choice. We design a game in which participants are asked to choose between a flat wage and a tournament scheme and to perform under each scheme. Our data indicate that men and women of similar ability differ in both performance and compensation choice. Men are more likely to choose a tournament than a flat wage scheme. These findings reflect both higher women (men)‟s concerns for equality (competitive preferences) and stronger men‟s overconfidence. Our data also indicate significant gender differences in effort provision. Men increase significantly more their effort than women when moving from a flat wage to a tournament. More surprisingly, our data show that women provide significantly more effort than men under a flat wage scheme despite the absence of any penalty for shirking and the fastidious and boring dimension of the task. This gender gap remains highly significant after controlling for several individual and social preferences. As such, we believe that an interpretation in terms of gender differences in intrinsic motivation is the most consistent with all of our experimental findings.
    Keywords: PME, Experiment, Gender differences, Tournament Scheme, Flat Wage Scheme
    JEL: C91 J16 J31 M52
    Date: 2012–07
  7. By: Salas, J.M. Ian S.; Abrigo, Michael Ralph M.; Racelis, Rachel H.
    Abstract: Philippine population is projected to grow from about 88 million in 2007 to 142 million in 2040. The projected increase in population size will be accompanied by change in the age structure: increase in the percentages of elderly and working-age populations and decrease in the percentage of young population. Increase in population size by itself will drive aggregate consumption and labor income to increase. But this paper also shows that the projected change in the population age distribution will contribute additional increase in both aggregate consumption and labor income. The age structure change can potentially lead to some favorable outcomes: slower increase in aggregate consumption of the young deficit age groups; higher increase in aggregate labor income compared to aggregate consumption overall; and higher proportion of the lifecycle "deficits" that can be covered by "surplus." Still, the projected change in population age structure also presents challenges. One major challenge comes from the projected significant increase in the number of elderly and the fast increase in their aggregate consumption that will consequently follow. The practical challenge would be finding the means to finance this group`s growing consumption in the future.
    Keywords: Philippines, National Transfer Accounts, lifecycle deficit, financing consumption, population aging
    Date: 2012
  8. By: Rasmussen, Astrid Würtz (Aarhus University); Stratton, Leslie S. (Virginia Commonwealth University)
    Abstract: A substantial and growing fraction of children across Europe and the US live in single parent households. Law practices are evolving to encourage both parents to maintain contact with their children following parental separation/divorce, driven by the belief that such contact is in the best interest of the child. We test this assumption by using information on the distance between non-residential parents and their children to proxy for contact, and measuring educational, behavioral, and health outcomes for a population sample of children from nonnuclear families in Denmark. Instrumental variables techniques are employed to control for the endogeneity of residence. The results indicate that educational and behavioral outcomes are better for children who live farther away from their non-residential parent, but that distance is not related to health outcomes. Failing to control for endogeneity biases the results in favor of more proximate parents. These findings suggest that policy efforts to keep separated parents geographically closer together for the sake of the children may, in fact, not be advantageous.
    Keywords: child outcomes, parental separation, distance
    JEL: D13 I12 I21 J12 J13
    Date: 2012–10
  9. By: Datta Gupta, Nabanita (Aarhus University); Lausten, Mette (SFI - Danish National Centre for Social Research); Pozzoli, Dario (Aarhus University)
    Abstract: We investigate the degree of correspondence between parents' reports on child behavioral and educational outcomes using the most recent available wave of a rich Danish longitudinal survey of children (the DALSC). All outcomes are measured at age 11 when the children are expected to be in fifth grade. Once discrepancies are detected, we analyze whether they are driven by noisy evaluations or by systematic bias, focusing on the role of parental characteristics and response heterogeneity. We then explicitly assess the relative importance of the mother's versus the father's assessments in explaining child academic performance and diagnosed mental health to investigate whether one parent is systematically a better informant of their child's outcomes than the other.
    Keywords: child development, informant discrepancies, reporting bias
    JEL: I12 J13
    Date: 2012–10
  10. By: Nabanita Datta Gupta (Department of Economics and Business, Aarhus University, Denmark); Mette Lausten (SFI, Copenhagen, Denmark); Dario Pozzoli (Department of Economics and Business, Aarhus University, Denmark)
    Abstract: We investigate the degree of correspondence between parents’ reports on child behavioral and educational outcomes using the most recent available wave of a rich Danish longitudinal survey of children (the DALSC). All outcomes are measured at age 11 when the children are expected to be in fifth grade. Once discrepancies are detected, we analyze whether they are driven by noisy evaluations or by systematic bias, focusing on the role of parental characteristics and response heterogeneity. We then explicitly assess the relative importance of the mother’s versus the father’s assessments in explaining child academic performance and diagnosed mental health to investigate whether one parent is systematically a better informant of their child’s outcomes than the other.
    Keywords: Child development, informant discrepancies, reporting bias
    JEL: I12 J13
    Date: 2012–11–02
  11. By: Brishti Guha (Singapore Management University, School of Economics)
    Abstract: Many men invest in their sisters’ children instead of their wives’. Existing theories addressing such behavior depend on the level of paternity probability in such men’s societies being implausibly low. I link this anthropologically observed investment behavior with the experimentally observed phenomenon that some individuals are ambiguity averse. Arguing that men’s decisions are made under ambiguity, I show that an increase in ambiguity aversion results in investment in sisters’, rather than wives’, children. I show that this can happen even under risk neutrality. I also consider the special cases of a SEU maximizer and of extreme ambiguity aversion in the Gilboa-Schmeidler sense. Extremely ambiguity averse individuals invest in sister’s children regardless of risk preference or actual paternity rates. An increase in ambiguity, rather than an increase in ambiguity aversion, in contrast, may affect the investment decision either way. When sufficiently many men are ambiguity averse, inheritance norms could become avuncular, affecting women’s incentives and generating a bias towards actual nonpaternity. This is consistent with, but represents an unusual explanation of, data which show correlations between inheritance norms and actual paternity rates.
    Date: 2012–09
  12. By: Steven Lugauer (Department of Economics, University of Notre Dame); Nelson Mark (Department of Economics, University of Notre Dame)
    Abstract: This paper studies how changing demographics can explain much of the evolution of China's household saving rate from 1955 to 2009. We undertake a quantitative investigation using an overlapping generations model in which agents live for 85 years. Agents begin to exercise decision making when they are 20. From age 20 to 63, they work. From age 20 to 49, they also provide for children. Dependent children's consumption enters into the parent's utility, and parents choose the consumption level of the young until they leave the household. Working agents transfer a portion of their labor income to their retired parents and save for their own retirement. Retirees live of of their accumulated assets and support from current workers. We present agents in the parameterized model with the future time-path of the demographics, interest rates and wages as given by the data and analyze their saving decisions. The simulated model accounts for nearly all the observed increase in the household saving rate from 1955 to 2009.
    Keywords: Saving Rate, Life-Cycle, China, Demographics, Overlapping Generations
    JEL: E2 J1
    Date: 2010–12
  13. By: Kirk Doran (Department of Economics, University of Notre Dame)
    Abstract: Do employers substitute adults for children, or do they treat them as complements? Using data from a Mexican schooling experiment, I find that decreasing child farm work is accompanied by increasing adult labor demand. This increase was not caused by treatment money reaching farm employers: there were no significant increases in harvest prices and quantities, non-labor inputs, or non-farm labor supply. Furthermore, coordinated movements in price and quantity can distinguish this increase in demand from changes in supply induced by the treatment's income effects. Thus, declining child supply caused increasing adult demand: employers substituted adults for children.
    Date: 2012–08
  14. By: Richard Jensen (Department of Economics, University of Notre Dame); Steven Lugauer (Department of Economics, University of Notre Dame)
    Abstract: We estimate the age distribution's impact on carbon dioxide emissions from 1990 to 2006 by exploiting demographic variation in a panel of 46 countries. To eliminate potential bias from endogeneity or omitted variables, we instrument for the age distribution with lagged birth rates, and the regressions control for total population, output, and country and year fixed effects. The increase in the share of the population aged 35 to 49 accounts for a large portion of the observed increase in carbon dioxide emissions.
    Keywords: Climate Change, Environment, Carbon Dioxide Emissions
    JEL: Q4 J1
    Date: 2012–06
  15. By: David de la Croix; Omar Licandro
    Abstract: We build a unique dataset of 300,000 famous people born between Hammurabi's epoch and 1879, Einstein's birth year. It includes, among other variables, the vital dates, occupations, and locations of celebrities from the Index Bio-bibliographicus Notorum Hominum (IBN), a very comprehensive biographical tool. Our main contribution is fourfold. First, we show, using for the first time a worldwide, long-running, consistent database, that mortality displays no trend during the Malthusian era. Second, after correcting for selection and composition biases, we date the beginning of the steadily improvements in longevity to the cohort born in 1640-9, clearly preceding the Industrial Revolution. Third, we find that this timing of longevity improvements concerns most countries in Europe, as well as all types of skilled occupations. Finally, the reasons for this early rise in mean lifetime have to be found in age-dependent shifts in the survival law.
    Keywords: Longevity, Notoriety, Malthus, Gompertz-Makeham, Compensation Effect of Mortality
    JEL: J11 I12 N30 I20 J24
    Date: 2012–10
  16. By: Tobias Caris (University of Marburg); Bernd Hayo (University of Marburg)
    Abstract: We investigate why female labour market participation is low in the Arab region. Utilising Akerlof and Kranton’s (2000) ‘identity economics’ approach, we show in a simple gametheoretic framework that women socialised in a traditional family environment violate their identities by taking a job. In the empirical analysis, we study the respective impact of two determinants of identity in the Arab region, Islam and cultural tradition. Employing two waves of the World Values Survey, we find significant evidence that identity affects female labour market participation. Moreover, our estimates suggest that in the Arab region, Muslim women do not participate in the labour market less than non-Muslim women, whereas those with strong traditional identities have a 7 percentage point lower probability of entering the labour market.
    Keywords: Female labour market participation, Arab region, Islam, Identity, Religion
    JEL: J16 J21 Z12 Z13 O53
    Date: 2012
  17. By: Salas, J.M. Ian S.; Abrigo, Michael Ralph M.; Racelis, Rachel H.
    Abstract: <p>Financing of education in the Philippines is mainly by the government (public) and by households (private), and since the 1990s there has been a shift in the public/private mix in education financing toward higher private share. Between 2007 and 2040 the schooling age population of the Philippines is projected to continue to increase in size and the age structure to shift toward higher proportion in the age group that attend the tertiary school level. This paper presents results of simulations of aggregate education consumption or expenditures by age and by income group for two hypothetical scenarios: simulations using an alternative education financing mix (alternative to the 2007 financing mix); and simulations using the 2040 school-age population (in place of the 2007 population).</p><p>The aggregate age profile simulations for the two scenarios are then compared with the 2007 actual aggregate age profiles to derive implications of the two sets of change on the education expenditures of the different income groups. The comparisons showed that the two changes, shift in education financing mix toward higher private share and change in school-age population age structure from 2007 to 2040, would among others result to reduced share of education resources and higher per capita private education cost for the bottom income tercile group.</p>
    Keywords: Philippines, National Transfer Accounts, education expenditures by age, education financing, education expenditures by income group
    Date: 2012
  18. By: Headey, Bruce (Melbourne Institute of Applied Economic and Social Research); Muffels, Ruud (Tilburg University); Wagner, Gert G. (DIW Berlin)
    Abstract: There are strong two-way links between parent and child happiness (life satisfaction), even for 'children' who have grown up, moved to their own home and partnered themselves. German panel evidence shows that transmission of (un)happiness from parents to children is partly due to transmission of values and behaviors known to be associated with happiness (Headey, Wagner and Muffels, 2010, 2012). These values and behaviors include giving priority to pro-social and family values, rather than material values, maintaining a preferred balance between work and leisure, active social and community participation, and regular exercise. Both parents have about equal influence on the values and behaviors which children adopt. However, the life satisfaction of adult 'children' continues to be directly influenced by the life satisfaction of their mothers, with the influence of fathers being only indirect, via transmission of values and behaviors. There appears to be a lifelong happiness dividend (or unhappiness dividend) due to parenting. Structural equation models with two-way causation indicate that the life satisfaction of offspring can significantly affect the satisfaction of their parents, as well as vice-versa, long after the 'children' have left home. Data come from 25 waves of the German Socio-Economic Panel Survey (SOEP, 1984-2008). SOEP is the only panel survey worldwide in which data on life satisfaction have been obtained from parents and an adequate sub-sample of children no longer living in the parental home.
    Keywords: life satisfaction, subjective well-being, child happiness, inter-generational transmission, German Socio-Economic Panel (SOEP), structural equation models
    JEL: D60 I31 J13 J22 C33
    Date: 2012–10
  19. By: Andreas Leibbrandt; John A. List
    Abstract: One explanation advanced for the persistent gender pay differences in labor markets is that women avoid salary negotiations. By using a natural field experiment that randomizes nearly 2,500 job-seekers into jobs that vary important details of the labor contract, we are able to observe both the nature of sorting and the extent of salary negotiations. We observe interesting data patterns. For example, we find that when there is no explicit statement that wages are negotiable, men are more likely to negotiate than women. However, when we explicitly mention the possibility that wages are negotiable, this difference disappears, and even tends to reverse. In terms of sorting, we find that men in contrast to women prefer job environments where the ‘rules of wage determination’ are ambiguous. This leads to the gender gap being much more pronounced in jobs that leave negotiation of wage ambiguous.
    JEL: C93 J0
    Date: 2012–11
  20. By: Hugo Benitez-Silva (Department of Economics, Stony Brook University); J. Ignacio Garcia-Perez (Universidad Pablo de Olavide and FEDEA); Sergi Jimenez-Martin Author-Email: (Universitat Pompeu Fabra, Barcelona GSE and FEDEA)
    Abstract: Unemployment rates in developed countries have recently reached levels not seen in a generation, and workers of all ages are facing increasing probabilities of losing their jobs and considerable losses in accumulated assets. These events have increased the reliance that most (older) workers have on public social insurance programs, exactly at a time that public finances are suffering from a large drop in contributions. Using administrative and household level data we empirically characterize a Life- Cycle model of retirement and claiming decisions in terms of the employment, wage, health, and mortality uncertainty faced by individuals. We analyze the role of three intertwined factors in the recent evolution of work and retirement benefits claiming behavior in the United States; namely, higher unemployment uncertainty, higher unemployment benefits, and wealth shocks. We find that higher employment uncertainty reduces work and increases early claiming, while higher unemployment benefits mildly reduce work and reduce claiming at early ages. Finally, wealth shocks increase both early claiming and work. When all these factors are combined, the final outcome is a mild decline in labor supply and little variation in early claiming.
    JEL: J14 J26 J65
    Date: 2012–10
  21. By: Adida, Claire L. (University of California, San Diego); Laitin, David D. (Stanford University); Valfort, Marie-Anne (University of Paris 1 Panthéon-Sorbonne)
    Abstract: We analyze the assimilation patterns of Muslim immigrants in Western countries with a unique identification strategy. Survey and experimental data collected in France in 2009 reveal that Muslims and rooted French are locked in a sub-optimal equilibrium whereby (i) rooted French exhibit taste-based discrimination against those they are able to identify as Muslims and (ii) Muslims perceive French institutions as systematically discriminatory against them. This equilibrium is sustained because Muslims, perceiving discrimination as institutionalized, are reluctant to assimilate and rooted French, who are able to identify Muslims as such due to their lower assimilation, reveal their distaste for Muslims.
    Keywords: assimilation, Muslim and Christian immigrants, discrimination, France
    JEL: C90 D03 J15 J71 Z12
    Date: 2012–10
  22. By: Bellou, Andriana (University of Montreal); Bhatt, Rachana (Georgia State University)
    Abstract: From 1994-2009, forty-three states changed the design of their driver's license/state identification cards in an effort to reduce underage access to and consumption of alcohol and tobacco. In these states, individuals under the age of 21 are issued licenses that are vertically oriented, whereas licenses for individuals 21 and older retain a traditional horizontal shape. This paper examines the effect of this design change on underage alcohol and tobacco use. Using a difference-in-difference methodology, we find a reduction in drinking and smoking for 16 year olds. These results are robust to the inclusion of state-specific linear time trends, and are upheld in a triple difference model that uses a within state control group of teens that did not receive a vertical license to control for state-specific unobserved factors. Interestingly, we find that the effects of the design change are concentrated in the 1-2 years after a state begins issuing vertical licenses; there is little evidence of an effect of the license on underage consumption in the long-run. This finding is consistent with a scenario where, over time, teens substitute towards other methods of obtaining age-restricted products, and/or retailers continue to make underage sales.
    Keywords: youth alcohol and tobacco policies
    JEL: I1 J1
    Date: 2012–10
  23. By: Salas, J.M. Ian S.; Abrigo, Michael Ralph M.; Racelis, Rachel H.
    Abstract: <p>This paper explores how elderly labor income can be expanded as a financing source for elderly consumption in the future through increase in elderly work activity. It examines elderly living arrangements and other factors that may influence elderly participation in work activities. The prospects of increasing elderly work activity in the future is assessed based on past and possible future trends in the following three factors, among many others: elderly health status, household headship by the elderly, and employment opportunities for the elderly, particularly household entrepreneurial activities.</p><p>Alternative scenarios of increases in elderly labor force size (based on assumed changes in the factors) were used in simulations and results show that the higher the increase in labor force size (1) the higher the increase in aggregate labor income, (2) the higher the proportion of consumption that can be covered by own labor income, (3) the higher the elderly deficit age cut-off, and (4) the larger the decline in the aggregate lifecycle deficit of the elderly. What can government do to encourage more elderly to continue working? Government action can focus on two areas: elderly health and well-being, and elderly employment opportunities and enabling environment. The government can finance and fully implement provisions in existing laws and public programs that address the two areas such as those articulated in the Senior Citizen`s Acts (1992 Republic Act 7432 and 2003 RA 9257) and the Philippine Plans of Action for Senior Citizens (1999-2004 and 2006-2010).</p>
    Keywords: Philippines, National Transfer Accounts, lifecycle deficit, population aging, elderly work activity, old-age support
    Date: 2012
  24. By: Justine Burns (School of Economics, University of Cape Town); Simon Halliday; Malcolm Keswell
    Abstract: We examine whether differences in risk preferences explain gender differentials in test scores amongst a large class of undergraduate microeconomics students, where students were evaluated using multiple choice questions. In each of five class tests, the negative penalty associated with an incorrect answer was randomly varied across questions. We show that female students exhibit lower risk propensities on average, and that they are more responsive than males to an increase in the penalty for an incorrect answer. Controlling for dierences in risk preferences, we show that the gender differential in relation to answering any given question correctly reduces by a third, and that the gender differential in overall test scores becomes statistically insignicant. This result is robust to a variety of distributional assumptions.
    Keywords: Experimental Economics, Risk Aversion, Economics Education
    JEL: A2 A20 A22 C90 D81
    Date: 2012
  25. By: Schneeweis, Nicole (University of Linz); Skirbekk, Vegard (University of Rostock); Winter-Ebmer, Rudolf (University of Linz)
    Abstract: We study the relationship between education and cognitive functioning at older ages by exploiting compulsory schooling reforms, implemented in six European countries during the 1950s and 1960s. Using data of individuals aged 50+ from the Survey of Health, Aging and Retirement in Europe (SHARE), we assess the causal effect of education on old-age memory, fluency, numeracy, orientation and dementia. We find a positive impact of schooling on memory. One year of education increases the delayed memory score by about 0.3, which amounts to 16% of the standard deviation. Furthermore, for women, we find that more education reduces the risk of dementia.
    Keywords: compulsory schooling, instrumental variables, education, cognitive functioning, memory, aging, dementia
    JEL: I21 J14
    Date: 2012–10
  26. By: Dorothea Blomeyer (Central Institute of Mental Health (ZI), Mannheim); Katja Coneus (SAP, Walldorf); Manfred Laucht (Central Institute of Mental Health (ZI), Mannheim); Friedhelm Pfeiffer (Centre for European Economic Research (ZEW), Mannheim)
    Abstract: This paper investigates the role of early life adversity and home resources in terms of competence formation and school achievement based on data from an epidemiological cohort study following 364 children from birth to adolescence. Results indicate that organic and psychosocial risks present in early life as well as the socio-emotional home environment are significant predictors for the formation of competencies. Competencies acquired at preschool age predict achievement at school age. A counterfactual analysis is performed to assess trade-offs in the timing of interventions in the early life cycle.
    Keywords: Initial Risk Matrix, Socio-Emotional and Economic Home Resources, Intelligence, Persistence, Peer Relationship, School Achievement
    JEL: D87 I12 I21
    Date: 2012–10
  27. By: Bezabih, Mintewab (Department of Economics, University of Sussex); Holden, Stein (Department of Economics and Resource Management, Norwegian University of Life Sciences); Mannberg, Andrea (Department of economics, Umeå university)
    Abstract: This paper analyses the impact of a low cost and restricted rights land certification program on the productivity of female-headed households. The analysis is based on plot level panel data from the East Gojjam and South Wollo Zones in the Amhara region of Ethiopia. The results suggest a positive and significant effect of certification on plot-level productivity, particularly on plots rented out to other operators. In addition, the results show that certification has different impacts on male and female productivity with female-headed households gaining significantly more and with zonal differences in the effectiveness of certification impacts.
    Keywords: Ethiopia; Female Headed Households; Productivity; Land Market; Certification
    JEL: D02 Q12 Q15
    Date: 2012–09–01
  28. By: T., MAHESWARI
    Abstract: The world has changed greatly since the 1960s and 1970s, when there existed a virtual consensus among Western experts that rapid population growth in the developing world represented a serious global crisis. One of the primary causes of environmental degradation in a country could be attributed to rapid growth of population, which adversely affects the natural resources and environment. This study, in general, makes an endeavor to demonstrate how the population growth in Madurai district in Tamilnadu State of India has been conducive to the environmental degradation. In all the decades the decadal growth rate of population of Madurai district is higher than that of State except in the decade 1991-2001. It can be concluded from the present study that there is a pressure of population on the environment in Madurai district. Population is an important source of development, yet it is a major source of environmental degradation when it exceeds the threshold limits of the support systems. Unless the relationship between the multiplying population and the life support system can be stabilized, development programs, howsoever, innovative are not likely to yield desired results.
    Keywords: Madurai; Population; Environment
    JEL: Q50
    Date: 2012–10–30
  29. By: Nicolas Jacquemet (EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, BETA - Bureau d'économie théorique et appliquée - CNRS : UMR7522 - Université de Strasbourg - Université Nancy II); Constantine Yannelis (Stanford University - Department of Economics - Department of Economics)
    Abstract: Numerous field experiments have demonstrated the existence of discrimination in labor markets against specific minority groups. This paper uses a correspondence test to determine whether this discrimination is due to prejudice against specific groups, or a general preference for the majority group. Three groups of identical fabricated resumes are sent to help-wanted advertisements in Chicago newspapers: one with Anglo-Saxon names, one with African-American names, and one with fictitious foreign names whose ethnic origin is unidentifiable to most Americans. Resumes with Anglo-Saxon names generate nearly one third more call-backs than identical resumes with non Anglo-Saxon ones, either African-American or Foreign. We take this as evidence that discriminatory behavior is part of a larger pattern of unequal treatment of any member of non-majority groups, ethnic homophily.
    Keywords: Correspondence testing; Discrimination; Ethnic homophily
    Date: 2012–12
  30. By: Alberto Alesina; Stelios Michalopoulos; Elias Papaioannou
    Abstract: This study explores the consequences and origins of contemporary differences in well-being across ethnic groups within countries. We construct measures of ethnic inequality combining ethnolinguistic maps on the spatial distribution of groups with satellite images of light density at night. Ethnic inequality is strongly inversely related to per capita income; this pattern holds when we condition on the overall degree of spatial inequality -that is also associated with underdevelopment. We further show that differences in geographic endowments across ethnic homelands explain a sizable portion of contemporary ethnic inequality. This deeplyrooted inequality in geographic attributes across ethnic regions is also negatively related to comparative development. We also show that ethnic inequality goes in tandem with lower levels development also within countries. Using micro-level data from the Afrobarometer surveys we show that individuals from the same ethnic group are worse off when they reside in districts with a high degree of ethnic inequality.
    Keywords: Ethnicity, Diversity, Inequality, Development, Geography
    Date: 2012
  31. By: Alberto F. Alesina; Stelios Michalopoulos; Elias Papaioannou
    Abstract: This study explores the consequences and origins of contemporary differences in well-being across ethnic groups within countries. We construct measures of ethnic inequality combining ethno-linguistic maps on the spatial distribution of groups with satellite images of light density at night. Ethnic inequality is strongly inversely related to per capita income; this pattern holds when we condition on the overall degree of spatial inequality – that is also associated with underdevelopment. We further show that differences in geographic endowments across ethnic homelands explain a sizable portion of contemporary ethnic inequality. This deeply-rooted inequality in geographic attributes across ethnic regions is also negatively related to comparative development. We also show that ethnic inequality goes in tandem with lower levels development within countries. Using micro-level data from the Afrobarometer surveys we show that individuals from the same ethnic group are worse off when they reside in districts with a high degree of ethnic inequality.
    JEL: D63 O10 O40 O43 R12
    Date: 2012–11
  32. By: Robert Chambers (University of Maryland); Vangelis Tzouvelekas (Department of Economics, University of Crete, Greece)
    Abstract: We develop a biologically correct cost system for production systems facing invasive pests that allows the estimation of population dynamics without a priori knowledge of their true values. We apply that model to a data set for olive producers in Crete and derive from it predictions about the underlying populations dynamics. Those dynamics are compared to information on population dynamics obtained from pest sampling with extremely favorable results.
    Keywords: separabale technologies, pest population, damage control, olive farms, Greece 1
    Date: 2012–11–03
  33. By: Ronkainen , Vesa (Financial Supervisory Authority)
    Abstract: This work studies and develops tools to quantify and manage the risks and uncertainty relating to the pricing of annuities in the long run. To this end, an idealized Monte-Carlo simulation model is formulated, estimated and implemented, which enables one to investigate some typical pension and life insurance products. The main risks in pension insurance relate to investment performance and mortality/longevity development. We first develop stochastic models for equity and bond returns. The S&P 500 yearly total return is modeled by an uncorrelated and Normally distributed process to which exogenous Gamma distributed negative shocks arrive with Geometrically distributed interarrival times. This regime switching jump model takes into account the empirical observations of infrequent exceptionally large losses. The 5-year US government bond yearly total return is modeled as an ARMA(1,1) process after suitably log-transforming the returns. This model is able to generate long term interest rate cycles and allows rapid year-to-year corrections in the returns. We also address the parameter uncertainty in these models. <p> We then develop a stochastic model for mortality. The chosen mortality forecasting model is the well-known model of Lee and Carter (1992), in which we use the Bayesian MCMC methods in the inference concerning the time index. Our analysis with a local version of the model showed that the assumptions of the Lee-Carter model are not fully compatible with Finnish mortality data. In particular we found that mortality has been lower than average for the cohort born in wartime. However, because the forecasts of these two models were not significantly different, we chose the more parsimonious Lee-Carter model. Although our main focus is on the total population data, we also analysed the data for males and females separately. Finally we build a flexible model for the dependence structure that allows us to generate stochastic scenarios in which mortality and economic processes are either uncorrelated, correlated or shock-correlated. <p> By using the simulation model to generate stochastic pension cash-flows, we are then able to analyse the financing of longevity risk in pension insurance and the resulting risk management issues. This is accomplished via three case studies. Two of these concentrate on the pricing and solvency questions of a pension portfolio. The first study covers a single cohort of different sizes, and the second allows for multiple cohorts of annuitants. The final case study discusses individual pension insurance from the customer and long-term points of view. <p> Realistic statistical long-term risk measurement is the key theme of this work, and so we compare our simulation results with the Value-at-Risk or VaR approach. The results show that the limitations of basic VaR approach must be carefully accounted for in applications. The VaR approach is the most commonly used risk measurement methodology in insurance and finance applications. For instance, it underlies the solvency capital requirement in Solvency II, which we also discuss in this work.
    Keywords: equities; stocks; jump model; bond; longevity; Lee-Carter model; stochastic mortality; cohort mortality; dependence model; asymmetric dependence; parameter uncertainty; stochastic annuity; pension; cohort size; solvency; internal model
    JEL: G12 J11
    Date: 2012–05–25
  34. By: Kang, Young ho; Kim, Byung Yeon
    Abstract: This paper assesses the heterogeneous effects of immigration on economic growth depending on both the origin and the destination countries. Following the development of a simple growth model augmented by the embodied human capital of immigrants, we estimate the growth equation using both a gravity-style instrument variable approach and the dynamic system-GMM estimator. We find that immigration from developed economies positively affects the economic growth of the host countries. Furthermore, the growth-enhancing effect of immigration is significantly larger when immigration flows from developed to developing economies than when it does to those that include both developed and developing economies. We interpret these results as evidence of immigrants from developed countries bringing with them - upon entry - their advanced knowledge on technology and institutions into the developing countries that host them.
    Keywords: Immigration, economic growth, human capital, institutions
    JEL: F22 O15 O41 O43
    Date: 2012–07
  35. By: Löfström, Åsa (Department of Economics, Umeå School of Business and Economics, Umeå University)
    Abstract: En mycket vanlig förklaring till att det finns en löneskillnad mellan kvinnor och män är att de inte har samma yrke och samma utbildning. Kan denna förklaring därmed tolkas som att lönegapet är lika med noll i yrken där det både finns kvinnor och män? För att få svar på detta analyserade vi en grupp kvinnliga och manliga ekonomer med högskoleutbildning. Trots denna likhet var den könsrelaterade löneskillnaden inte försumbar. En närmare granskning av lönestrukturen i yrket visade dock att lönegapets storlek varierade. Det var större högre upp i fördelningen och mindre i den undre delen. Trots att könsfördelningen på de olika stegen i karriärtrappan är jämnare idag än tidigare och trots att ”glastaket” börjat krackelera på sina håll är löneskillnaden mellan kvinnor och män fortfarande stora. Sett i ett livscykelperspektiv betyder det också att männens livsinkomst blir högre vilket i sin tur kommer att de dom en tryggare ålderdom, via högre pension, än vad kvinnor kommer att få. Eftersom det länge sagts att ”bara” kvinnor utbildar sig, ”bara” kvinnor kommit ikapp männen och ”bara” de engagerar sig mer i sina jobb då kommer också deras löne- och karriärvillkor att bli som männens. Frågan man därför kan ställa sig idag är om denna förväntan snarare är att likna vid en illusion, en livslögn, än en faktisk möjlighet?
    Keywords: Kvinnor; män; löneskillnad; livslön; karriär; utbildning; familj
    JEL: J16 J24 J31 J44 J71
    Date: 2012–10–23
  36. By: Jorge Miranda Pinto (Studies Division, Chilean Pension Supervisor)
    Abstract: Desde el año 2005 las Administradoras de Fondos de Pensión (AFP) envían, por instrucción de la Superintendencia de Pensiones, en la última cartola cuatrimestral, la proyección de pensión personalizada (PPP) a los afiliados al Sistema de Pensiones chileno. Esta proyección, cuyo objetivo es mejorar el nivel de educación previsional de los afiliados al sistema, muestra para el grupo de afiliados más cercanos a la edad legal de jubilación la proyección de pensión a la edad legal y si se posterga 3 años la jubilación. La información de la pensión proyectada en distintos escenarios de edad de jubilación podría hacer revisar las decisiones de jubilación de los afiliados con el objetivo de aumentar el monto de su pensión final. En este trabajo se evalúa el impacto del envío de la PPP los años 2005 y 2006 sobre la probabilidad de jubilar el año 2011. Los resultados revelan que existe evidencia de que la información contenida en la PPP reduce la probabilidad de jubilar para aquellos afiliados que recibieron la PPP en ambos años, 2005 y 2006, no así para quienes la recibieron en sólo una ocasión. Esto daría cuenta de que un grupo de afiliados buscaría aprovechar el retorno que tiene continuar cotizando al sistema más allá de la edad legal de jubilación, toda vez que las oportunidades del mercado laboral se lo permitan. Se encuentra que el efecto es heterogéneo y mayor en afiliados de alto ahorro previsional obligatorio, y de mayores habilidades cognitivas y no cognitivas..
    Keywords: proyección de pensión personalizada, decisión de jubilación, heterogeneidad no observada, parámetro de tratamiento
    JEL: J14 J26
    Date: 2012–10

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