nep-dem New Economics Papers
on Demographic Economics
Issue of 2017‒11‒12
five papers chosen by
Héctor Pifarré i Arolas
Max-Planck-Institut für demografische Forschung

  1. The rising longevity gap by lifetime earnings: Distributional implications for the pension system By Haan, Peter; Kemptner, Daniel; Lüthen, Holger
  2. Maternal Employment and Child Outcomes: Evidence from the Irish Marriage Bar By Mosca, Irene; O'Sullivan, Vincent; Wright, Robert E.
  3. Fertility Effects of Child Benefits By Regina T. Riphahn; Frederik Wiynck
  4. Assortative Mating and Earnings Inequality in France By Frémeaux, Nicolas; Lefranc, Arnaud
  5. Population Processes and Establishment-Level Racial Employment Segregation By Ferguson, John-Paul; Koning, Rembrand

  1. By: Haan, Peter; Kemptner, Daniel; Lüthen, Holger
    Abstract: This study uses German social security records to provide novel evidence about the heterogeneity in life expectancy by lifetime earnings and, additionally, documents the distributional implications of this earnings-related heterogeneity. We find a strong association between lifetime earnings and life expectancy at age 65 and show that the longevity gap is increasing across cohorts. For West German men born 1926-28, the longevity gap between top and bottom decile amounts to about 4 years (about 30%). This gap increases to 7 years (almost 50%) for cohorts 1947-49. We extend our analysis to the household context and show that lifetime earnings are also related to the life expectancy of the spouse. The heterogeneity in life expectancy has sizable and relevant distributional consequences for the pension system: when accounting for heterogeneous life expectancy, we find that the German pension system is regressive despite a strong contributory link. We show that the internal rate of return of the pension system increases with lifetime earnings. Finally, we document an increase of the regressive structure across cohorts, which is consistent with the increasing longevity gap.
    Keywords: mortality,lifetime inequality,pensions,redistribution
    JEL: H55 I14 J11
    Date: 2017
  2. By: Mosca, Irene (Trinity College Dublin); O'Sullivan, Vincent (Lancaster University); Wright, Robert E. (University of Strathclyde)
    Abstract: This paper investigates the relationship between maternal employment and child outcomes using micro-data collected in the third wave of The Irish Longitudinal Study on Ageing. A novel source of exogenous variation in the employment decisions of women is used to investigate this relationship. Between the 1920s and the 1970s in Ireland, women working in certain sectors and jobs were required to leave their jobs once they married. The majority of women affected by this "Marriage Bar" then became mothers and never returned to work, or returned only after several years. Regression analysis is used to compare the educational attainment of the children of mothers who were required to leave employment on marriage because of the Marriage Bar to the educational attainment of the children of mothers who were not required to do so. It is found that the children of mothers affected by the Marriage Bar were about seven percentage points more likely to complete university education than the children of mothers who were not. This is a sizeable effect when compared to the observation that about 40% of the children in the sample completed university education. This effect is found to be robust to alternative specifications that include variables aimed at controlling for differences in maternal occupation, personality traits, and differences in paternal education.
    Keywords: marriage, mother, employment, child, university education
    JEL: J12 J16 J20
    Date: 2017–10
  3. By: Regina T. Riphahn; Frederik Wiynck
    Abstract: We exploit the 1996 reform of the German child benefit program to identify the causal effect of heterogeneous child benefits on fertility. While generally the reform increased child benefits, the exact amount of the increase varied by household income and the number of children. We use these heterogeneities to identify their causal effects on fertility in a difference-in-differences setting. We apply the large samples of the German Mikrozensus and the rich data of the German Socio-economic Panel (SOEP). The reform effects on low income couples are not statistically significant. We find some support for positive fertility effects for higher as opposed to lower income couples deciding on a second birth.
    Keywords: child benefits, fertility, tax allowance, causal effect, difference-in-differences, Mikrozensus, SOEP
    JEL: J13 I38 C54
    Date: 2017
  4. By: Frémeaux, Nicolas (University of Paris 2); Lefranc, Arnaud (University of Cergy-Pontoise)
    Abstract: This paper analyzes economic assortative mating and its contribution to inequality in France. We first provide descriptive evidence on the statistical association in several socio-economic attributes of partners among French couples (annual earnings, potential earnings, education, occupation). Second, we assess the contribution of assortative mating to earnings inequality between couples. Contrary to previous estimates, we account for possible biases in the estimation of assortative mating arising from sample-selection into the labor force. We also provide a new method for assessing the contribution of assortative mating to inequality in couple's potential earnings. Our results indicate a strong degree of assortative mating in France. The correlation coefficient for education is above 0.6. The correlation in earnings is lower but sizable: around 0.17 for annual earnings, when including zeroes; around 0.35 for full-time equivalent earnings and up to 0.49 when using multi-year average earnings. We show that assortative mating tends to increase inequality among couples, compared to random mating. For annual earnings, the effect is non-negligible and accounts for 3 to 9% of measured inequality. The effect of assortative mating on household potential earnings is much larger and amounts to 10 to 20% for observed inequality.
    Keywords: assortative mating, inequality, earnings, labor supply, France
    JEL: J12 J22 D31
    Date: 2017–10
  5. By: Ferguson, John-Paul (Stanford University); Koning, Rembrand (Harvard University)
    Abstract: Racial segregation between American workplaces is greater today than it was a generation ago. This increase has happened alongside the declines in within-establishment occupational segregation on which most prior research has focused. We examine more than 40 years of longitudinal data on the racial employment composition of every large private-sector workplace in the United States and calculate decomposable Theil statistics of segregation to compare and contrast between-area, between-establishment, and within-establishment trends in racial employment segregation over time. We demonstrate that the increase in establishment segregation owes little to within-establishment processes but rather stems from the different birth and death rates of more- and less-homogeneous workplaces. Present research on employment segregation focuses intently on within-firm processes. By doing so, we may be overstating what progress has been made on employment integration and ignoring other avenues of intervention that may give greater leverage for further integrating firms.
    Date: 2017–06

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