nep-dem New Economics Papers
on Demographic Economics
Issue of 2014‒02‒15
ten papers chosen by
Michele Battisti
University of Munich

  1. Does Female Empowerment Promote Economic Development? By Matthias Doepke; Michèle Tertilt
  2. Health, financial incentives, and early retirement: Micro-simulation evidence for Germany By Hendrik Jürges; Lars Thiel; Tabea Bucher-Koenen; Johannes Rausch; Morten Schuth; Axel Börsch-Supan
  3. Could a Universal Family Payment improve gender equity and reduce child poverty in Australia? A microsimulation analysis By Hayes, Phillip; Redmond, Gerry
  4. Prospective Ageing and Economic Growth in Europe By Jesus Crespo Cuaresma; Martin Lábaj; Patrik Pruzinský
  5. Unemployment and domestic violence By Dan Anderberg; Helmut Rainer; Jonathan Wadsworth; Tanya Wilson
  6. Life Satisfaction, Ethnicity and Neighbourhoods: Is There an Effect of Neighbourhood Ethnic Composition on Life Satisfaction? By Lucinda Platt; Gundi Knies; Alita Nandi
  7. A model for the pension system in Mexico. Diagnosis and recommendations By Javier Alonso; Carmen Hoyo; David Tuesta
  8. Fertility and economic instability: the role of unemployment and job displacement By Del Bono, Emilia; Weber, Andrea; Winter-Ebmer, Rudolf
  9. All in the Family: How Do Social Capital and Material Wellbeing Affect Relational Wellbeing? By Martina Menon; Ravi Pendakur; Federico Perali
  10. Defined Contribution Pension Plans: Sticky or Discerning Money? By Clemens Sialm; Laura Starks; Hanjiang Zhang

  1. By: Matthias Doepke; Michèle Tertilt
    Abstract: Empirical evidence suggests that money in the hands of mothers (as opposed to fathers) increases expenditures on children. From this, should we infer that targeting transfers to women is good economic policy? In this paper, we develop a non-cooperative model of household decision making to answer this question. We show that when women have lower wages than men, they may spend more on children, even when they have exactly the same preferences as their husbands. However, this does not necessarily mean that giving money to women is a good development policy. We show that depending on the nature of the production function, targeting transfers to women may be beneficial or harmful to growth. In particular, such transfers are more likely to be beneficial when human capital, rather than physical capital or land, is the most important factor of production.
    JEL: D13 J16 O10
    Date: 2014–02
  2. By: Hendrik Jürges (University of Wuppertal); Lars Thiel (University of Wuppertal); Tabea Bucher-Koenen (Munich Center for the Economics of Aging); Johannes Rausch (Munich Center for the Economics of Aging); Morten Schuth (Munich Center for the Economics of Aging); Axel Börsch-Supan (Munich Center for the Economics of Aging)
    Abstract: About 20% of German workers retire on disability pensions. Disability pensions provide fairly generous benefits for those who are not already age-eligible for an old-age pension and who are deemed unable to work for health reasons. In this paper, we use two sets of individual survey data to study the role of health and financial incentives in early retirement decisions in Germany, in particular disability benefit uptake. We show that financial incentives to retire do affect sick individuals at least as much as healthy individuals. Based on 25 years of individual survey data and empirical models of retirement behavior, we then simulate changes in the generosity of disability pensions to understand how these changes would affect retirement behavior. Our results show that making the disability benefit award process more stringent without closing other early retirement routes would not greatly increase labor force participation in old age.
    JEL: H55 J14 J26
    Date: 2014–02
  3. By: Hayes, Phillip; Redmond, Gerry
    Abstract: The Australian income tax and transfer system has undergone considerable reform since the mid 1980s. As a number of commentators have pointed out, one impact of reforms to cash transfers for families, as well as of some reforms to direct taxes, has been the evolution of a defacto system of family taxation, with negative consequences, in terms of incentives to earn (and consequent deadweight loss), for parents, and especially for secondary earners in couple families with children. In this paper, we use a new Australian microsimulation model, ATM, built on the EUROMOD platform to examine the extent to which policies to support families with children through the tax and transfer system have been achieved at the expense of gender equity, and how the system could be better designed to achieve child poverty reduction with gender equity. Our analysis suggests that the institution of a universal family payment that would both improve incentives and reduce child poverty is potentially affordable, even before reduction of deadweight loss under the current system is taken in to account. However, such reforms as are modelled here would be politically difficult, since the main gainers would be families with children in the top half of the income distribution, and the main losers would be taxpayers who do not have dependent children.
    Date: 2014–02–10
  4. By: Jesus Crespo Cuaresma (Department of Economics, Vienna University of Economics and Business); Martin Lábaj (Department of Economic Policy, Faculty of National Economy, University of Economics in Bratislava); Patrik Pruzinský (Department of Economic Policy, Faculty of National Economy, University of Economics in Bratislava)
    Abstract: We assess empirically the role played by prospective ageing measures as a predictor of income growth in Europe. We show that prospective ageing measures which move beyond chronological age and incorporate changes in life expectancy are able to explain better the recent long-run growth experience of European economies. The improvement in explanatory power of prospective ageing indicators as compared to standard measures based on chronological age is particularly relevant for long-run economic growth horizons.
    Keywords: Economic growth, ageing, prospective age, old age dependency ratio
    JEL: I15 O15 O52
    Date: 2014–01
  5. By: Dan Anderberg; Helmut Rainer; Jonathan Wadsworth; Tanya Wilson
    Abstract: Contrary to popular belief, the incidence of domestic violence in Britain does not seem to have risen during the recession. But according to research by Jonathan Wadsworth and colleagues, men and women have experienced different risks of unemployment - and these have had contrasting effects on the level of physical abuse.
    Keywords: domestic violence, unemployment
    JEL: J12 D19
    Date: 2014–02
  6. By: Lucinda Platt (Department of Social Policy, London School of Economics and Political Science); Gundi Knies (Institute for Social and Economic Research, University of Essex); Alita Nandi (Institute for Social and Economic Research, University of Essex)
    Abstract: Using a rich, nationally representative data set with a large sample of minorities and matched small area characteristics, we explore differences in life satisfaction for ethnic groups living in UK. We test the hypothesis that minorities will be less satisfied, which will in part be explained by less favourable individual and area contexts, but that living in areas with a larger proportion of own ethnic group promotes well-being. We find that satisfaction is lower among minorities, ceteris paribus, but area concentration is associated with higher life satisfaction for certain groups. We discuss the implications of our findings.
    Keywords: Life Satisfaction, Happiness, Ethnic group, Neighbourhood, Subjective well-being, UKHLS
    JEL: I31 J15 R23 O15
    Date: 2014–02
  7. By: Javier Alonso; Carmen Hoyo; David Tuesta
    Abstract: The reform of the pension system of the Mexican Social Security Institute (IMSS) in 1997, limited the growing fiscal cost of the previous pay-as-you-go scheme. Sixteen years on from its creation, the Retirement Savings System (SAR) has had favourable macroeconomic effects for Mexico, as it has significantly increased financial savings and encouraged the development of local financial markets. The reform of the pension system of the Mexican Social Security Institute (IMSS) in 1997, limited the growing fiscal cost of the previous pay-as-you-go scheme. Sixteen years on from its creation, the Retirement Savings System (SAR) has had favourable macroeconomic effects for Mexico, as it has significantly increased financial savings and encouraged the development of local financial markets.
    Keywords: defined contribution, pensions, replacement rates
    JEL: G23 H55 J11 J26
    Date: 2014–02
  8. By: Del Bono, Emilia; Weber, Andrea; Winter-Ebmer, Rudolf
    Abstract: In this paper we study the separate effects of unemployment and job displace- ment on fertility in a sample of white collar women in Austria. Using an instru- mental variables approach we show that unemployment incidence as such has no negative effect on fertility decisions, but the very fact of being displaced from a career-oriented job has. Fertility rates for women affected by a firm closure are significantly below those of a control group, even after six years, and this is so irrespective of the incidence or the duration of the associated unemployment spell.
    Date: 2014–02–11
  9. By: Martina Menon (Department of Economics (University of Verona)); Ravi Pendakur (University of Ottawa (Canada)); Federico Perali (Department of Economics (University of Verona))
    Abstract: We use a unique dataset from Italy to investigate the impact of socioeconomic characteristics and social capital on family wellbeing and satisfaction. We assess wellbeing using four dimensions of satisfaction with family life: satisfaction with decision making processes, with relationships with partner and children, and with time spent with children. Social capital is measured through information about membership in organizations, trust, and interactions with others. We find that while socioeconomic characteristics and equivalent income in general do not have an impact on family wellbeing, social capital matters for family life satisfaction.
    Keywords: Subjective wellbeing, Relational satisfaction, Social capital.
    JEL: D19 I31 Z13
    Date: 2014–02
  10. By: Clemens Sialm (University of Texas at Austin); Laura Starks (Stanford University); Hanjiang Zhang (Stanford University)
    Abstract: Participants in defined contribution (DC) retirement plans rarely adjust their portfolio allocations, suggesting that their investment choices and consequent money flows are sticky and not discerning. Yet, the participants’ inertia could be offset by the DC plan sponsors, who adjust the plan’s investment options. We examine these countervailing influences on flows into U.S. mutual funds. We find that flows into funds that derive from DC assets are more volatile and exhibit more performance sensitivity than non-DC flows, primarily due to the adjustments of the investment options by the plan sponsors. Thus, DC retirement money is less sticky and more discerning.
    Date: 2014–01

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