nep-dem New Economics Papers
on Demographic Economics
Issue of 2014‒06‒28
eleven papers chosen by
Michele Battisti
University of Munich

  1. Do better property rights improve local income?: Evidence from First Nations' treaties By Fernando M. Aragon
  2. Are children driving the gender wage gap? Comparative evidence from Poland and Hungary By Ewa Cukrowska; Anna Lovasz
  3. Free to Leave? A Welfare Analysis of Divorce Regimes By Raquel Fernández; Joyce Cheng Wong
  4. Gender differences in sorting By Merlino L.P.; Parrotta P.; Pozzoli D.
  5. Living Arrangements in Europe: Whether and Why Paternal Retirement Matters By Luca Stella
  6. Rates of return and early retirement disincentives: Evidence from a German pension reform By Lüthen, Holger
  7. Comparative advantage, international trade, and fertility By Do, Quy-Toan; Levchenko, Andrei; Raddatz, Claudio
  8. Workforce Aging and the Labour Market Opportunities of Youth: Evidence from Canada By Dhanjal, Sundip; Schirle , Tammy
  9. Early retirement and cognitive decline. A longitudinal analysis using SHARE data By Martina Celidoni; Chiara Dal Bianco; Guglielmo Weber
  10. Do gender quotas pass the test ? Evidence from academic evaluations in Italy By Manuel Bagues; Mauro Sylos-Labini; Natalia Zinovyeva
  11. Health, Disability Insurance and Retirement in Denmark By Paul Bingley; Nabanita Datta Gupta; Michael Jorgensen; Peder Pedersen

  1. By: Fernando M. Aragon (Simon Fraser University)
    Abstract: This paper examines the effect of an improvement in property rights on a local economy. It uses the case of First Nations' modern treaties. These treaties are an important institutional reform that clarifies ownership of land and natural resources near Aboriginal communities. Using confidential micro-data, I find evidence of a positive impact of modern treaties on real household income. The effect is driven by employment income and spreads among workers in industries not directly affected by the reform. I also find an increase in real wages and housing costs. These results are consistent with property right reforms creating a positive demand shock that affects the whole local economy. This is a yet understudied mechanism through which better property rights can generate positive local spillovers.
    Keywords: property rights, institutions, local development
    JEL: O12 O18 P48
    Date: 2014–04
  2. By: Ewa Cukrowska (Faculty of Economic Sciences, University of Warsaw); Anna Lovasz (Institute of Economics, Centre for Economic and Regional Studies of the Hungarian Academy of Sciences, and Eotvos Lorand University)
    Abstract: The paper examines how much children and responsibilities related with them contribute towards the divergence of men’s and women’s wages, and consequently, to the formation of the gender wage gap. To derive the relative contribution of gender specific wage inequalities caused by the parenthood to the overall gender wage gap, we provide a modification of standard Oaxaca-Blinder decomposition method. Contrary to our expectations, the findings show that most of the gender wage inequality is due to the positive wage gap between men who do and do not have children and not due to the wage penalty incurred by mothers.
    Keywords: Gender Wage Gap, Family Gap, Motherhood Penalty, Wage Gap Decomposition
    JEL: J13 J22
    Date: 2014
  3. By: Raquel Fernández; Joyce Cheng Wong
    Abstract: During the 1970s the US underwent an important change in its divorce laws, switching from mutual consent to a unilateral divorce regime. Who benefitted and who lost from this change? To answer this question we develop a dynamic life-cycle model in which agents make consumption, saving, labor force participation (LFP), and marriage and divorce decisions subject to several shocks and given a particular divorce regime. We calibrate the model using statistics relevant to the life-cycle of the 1940 cohort. Conditioning solely on gender, our ex ante welfare analysis finds that women would fare better under mutual consent whereas men would prefer a unilateral system. Once we condition not only on gender but also on initial productivity, we find that men in the top three quintiles of the initial productivity distribution are made better off by a unilateral system as are the top two quintiles of women; the rest prefer mutual consent. We also find that although the change in divorce regime had only a small effect on the LFP of married women in the 1940 cohort, these effects would be considerably larger for a cohort who lived its entire life under a unilateral divorce system.
    JEL: J12 J16 K36
    Date: 2014–06
  4. By: Merlino L.P.; Parrotta P.; Pozzoli D. (GSBE)
    Abstract: In this paper, we investigate the sorting of workers in firms to understand gender gaps in labor market outcomes. Using Danish employer-employee matched data, we find strong evidence of glass ceilings in certain firms, especially after motherhood, preventing women from climbing the career ladder and causing the most productive female workers to seek better jobs in more female-friendly firms in which they can pursue small career advancements. Nonetheless, gender differences in promotion persist and are found to be similar in all firms when we focus on large career advancements. These results provide evidence of the sticky floor hypothesis, which, together with the costs associated with changing employer, generates persistent gender gaps.
    Keywords: Economics of Gender; Non-labor Discrimination; Human Capital; Skills; Occupational Choice; Labor Productivity; Job, Occupational, and Intergenerational Mobility; Promotion;
    JEL: J16 J24 J62
    Date: 2014
  5. By: Luca Stella (University of Padova)
    Abstract: This paper uses retrospective micro data from eleven European countries to investigate the role of paternal retirement in explaining children's decisions to leave the parental home. To assess causality, I use a bivariate discrete-time hazard model with shared frailty and exploit over time and cross-country variation in early retirement legislation. Overall, the results indicate a positive and significant influence of paternal retirement on the probability of first nest-leaving of children residing in Southern European countries, both for sons and daughters. By contrast, there is no evidence of significant effects on children living in Northern and Central European countries. I then discuss and test empirically the potential mechanisms by which paternal retirement may affect children's nest-leaving. My results suggest that the increase in children's nest-leaving around paternal retirement does not appear to be justified by changes in parental resources or in the supply of informal child care provided by grandparents. Rather, one must probably look for channels involving home characteristics or negative externalities in preferences between parents and children.
    Keywords: Living Arrangements, Retirement, SHARE.
    JEL: J13 J26
    Date: 2014–02
  6. By: Lüthen, Holger
    Abstract: To counteract the financial pressure emerging in aging societies, statutory pay-as-you-go pension schemes are undergoing fundamental reforms in many Western countries. Starting with cohort 1937, Germany introduced permanent pension deductions for early retirement. This paper examines the evolution of the profitability of pension contributions against the background of this reform for cohorts 1935-1945. I measure the profitability with the internal rate of return (IRR) and use high quality administrative data. For men the IRR declines from 2.4% to 1.2% and for women from 5.2% to 3.7%. The results suggest that the deductions introduced by the reform only cause some part of this trend. The majority of the trend, about 75%-80%, is caused by increased pension contributions. --
    Keywords: pensions,reform,early retirement,disincentives,pay-as-you-go,rates of return,Germany
    JEL: D02 D04 D14 D91 H55
    Date: 2014
  7. By: Do, Quy-Toan; Levchenko, Andrei; Raddatz, Claudio
    Abstract: This paper analyzes theoretically and empirically the impact of comparative advantage in international trade on fertility. It builds a model in which industries differ in the extent to which they use female relative to male labor and countries are characterized by Ricardian comparative advantage in either female labor or male labor intensive goods. The main prediction of the model is that countries with comparative advantage in female labor intensive goods are characterized by lower fertility. This is because female wages and therefore the opportunity cost of children are higher in those countries. The paper demonstrates empirically that countries with comparative advantage in industries employing primarily women exhibit lower fertility. The analysis uses a geography-based instrument for trade patterns to isolate the causal effect of comparative advantage on fertility.
    Keywords: Economic Theory&Research,Labor Policies,Population Policies,Labor Markets,Trade Policy
    Date: 2014–06–01
  8. By: Dhanjal, Sundip; Schirle , Tammy
    Abstract: In this study, we investigate whether an aging workforce affects the job opportunities of youth. Provincial data from the 1976-2013 Labour Force Surveys and a fixed-effects model is used to estimate the effect of the share of the adult male labour force that is aged 55 to 69 on the employment and unemployment rates of men aged 25 to 29. We estimate effects on other labour market outcomes including wages and school enrolment, and other samples of younger men and women. There is no evidence to suggest that a growing share of older workers negatively affects the decisions or outcomes of youth in the labour market. To the contrary, there is weak evidence to suggest an aging population has a positive effect on the labour market outcomes of youth.
    Keywords: Population aging, employment, unemployment, youth
    JEL: J11 J21
    Date: 2014–06–16
  9. By: Martina Celidoni (University of Padova); Chiara Dal Bianco (University of Venezia); Guglielmo Weber (University of Padova)
    Abstract: We use a new measure of cognitive decline that is highly predictive of the onset of dementia and can be computed in standard surveys where recall memory tests are administered to the same individuals over the years. Using SHARE data, we investigate the association between cognitive decline and years in retirement controlling for age, physical health, early life conditions and socio-economic status. We find a positive association and an even stronger causal effect. The evidence we produce confirms the Ômental retirementÕ hypothesis and suggests its relevance for the onset of dementia.
    Keywords: Ageing, cognition, retirement, instrumental variable estimation. Classification-JEL: I12, I1, J26.
    Date: 2013–12
  10. By: Manuel Bagues; Mauro Sylos-Labini; Natalia Zinovyeva
    Abstract: This paper analyzes whether the presence of women in academic committees benefits female candidates. We exploit evidence from Italy, where candidates to Full and Associate Professor positions are required to qualify in a nation-wide evaluation known as Abilitazione Scientifica Nazionale. In 2012, these evaluations involved around 66,000 applications in all academic disciplines and around 900 (randomly chosen) evaluators. We estimate the causal effect of committees' gender composition exploiting the procedure of random assignment of evaluators to committees. Each additional female evaluator decreases by 2 percentage points the success rate of female candidates. The effect is similar in magnitude in evaluations for Full and Associate Professor positions, but it is only statistically significant in the later case. Information from 260,000 individual evaluations suggests that the presence of women in the committee affects the voting behavior of men. Overall, our results cast doubts on the convenience of introducing gender quotas in academia.
    Keywords: gender quotas, discrimination, academic promotions
    Date: 2014–06–21
  11. By: Paul Bingley; Nabanita Datta Gupta; Michael Jorgensen; Peder Pedersen
    Abstract: There are large differences in labor force participation rates by health status. We examine to what extent these differences are determined by the provisions of Disability Insurance and other pension programs. Using administrative data for Denmark we find that those in worse health and with less schooling are more likely to receive DI. The gradient of DI participation across health quintiles is almost twice as steep as for schooling – moving from having no high school diploma to college completion. Using an option value model that accounts for different pathways to retirement, applied to a period spanning a major pension reform, we find that pension program incentives in general are important determinants of retirement age. Individuals in poor health and with low schooling are significantly more responsive to economic incentives than those who are in better health and with more schooling. Similar gradients in outcomes and behavior by health and schooling partially reflects the less educated having poorer health on average, but also that the less educated have worse job prospects and higher replacement rates due to a progressive formula for DI and other pension benefits.
    JEL: H55 I1 J14
    Date: 2014–05

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