nep-dem New Economics Papers
on Demographic Economics
Issue of 2018‒01‒08
eight papers chosen by
Héctor Pifarré i Arolas
Max-Planck-Institut für demografische Forschung

  1. Missing Poor and Income Mobility By Mathieu Lefebvre; Pierre Pestieau; Grégory Ponthière
  2. Grandmothers’ Labor Supply By Frimmel, Wolfgang; Halla, Martin; Schmidpeter, Bernhard; Winter-Ebmer, Rudolf
  3. Causal Effects of Family Income on Child Outcomes and Educational Spending: Evidence from a Child Allowance Policy Reform in Japan By Michio Naoi; Hideo Akabayashi; Ryosuke Nakamura; Kayo Nozaki; Shinpei Sano; Wataru Senoh; Chizuru Shikishima
  4. Fertility effects of college education: Evidence from the German educational expansion By Kamhöfer, Daniel A.; Westphal, Matthias
  5. Fertility, Household Size and Poverty in Nepal By François Libois; Vincent Somville
  6. Expected Fertility and Educational Investment: Evidence from the One-Child-Policy in China By Raiber, Eva
  7. Who Becomes an Inventor in America? The Importance of Exposure to Innovation By Alex Bell; Raj Chetty; Xavier Jaravel; Neviana Petkova; John Van Reenen
  8. The Impact of Parenthood on the Gender Wage Gap – a Comparative Analysis of 26 European Countries By Ewa Cukrowska-Torzewska; Anna Lovasz

  1. By: Mathieu Lefebvre (CREPP - Center of Research in Public Economics and Population Economics - Université de Liège); Pierre Pestieau (CORE - Center of Operation Research and Econometrics [Louvain] - UCL - Université Catholique de Louvain); Grégory Ponthière (PSE - Paris School of Economics)
    Abstract: Higher mortality among the poor leads to selection biases in poverty measures. Whereas existing attempts to deal with the "missing poor" problem assume the absence of income mobility and assign to the prematurely dead a …ctitious income equal to the last income enjoyed, this paper relaxes that assumption in order to study the impact of income mobility on the size of the missing poor bias. We use data on poverty above age 60 in 12 countries from the EU-SILC database, and we compare standard poverty rates with the hypothetical poverty rates that would have pre- vailed if (i) all individuals, whatever their income, had enjoyed the same survival conditions (the ones of the highest income class), and if (ii) all individuals within the same income class had been subject to the same income mobility process. It is shown that taking income mobility into ac- count has adverse effects on corrected poverty measures across countries, and that it affects international comparisons in terms of old-age poverty.
    Keywords: poverty,measurement,mortality,missing poor,income mobility
    Date: 2017–12
  2. By: Frimmel, Wolfgang (Johannes Kepler University Linz and Christian Doppler Laboratory Aging, Health and the Labor Market); Halla, Martin (Johannes Kepler University Linz, Christian Doppler Laboratory Aging, Health and the Labor Market, IZA, Institute for the Study of Labor, Bonn and G¨OG, Austrian Public Health Institute, Vienna); Schmidpeter, Bernhard (University of Essex, Institute for Social and Economic Research); Winter-Ebmer, Rudolf (Johannes Kepler University Linz, Christian Doppler Laboratory Aging, Health and the Labor Market, IZA, Institute for the Study of Labor, Bonn, IHS, Institut for Advanced Studies, Vienna and CEPR, Centre for Economic Policy Research, London)
    Abstract: The labor supply effects of becoming a grandmother are not well established in the empirical literature. We estimate the effect of becoming a grandmother on the labor supply decision of older workers. Under the assumption that grandmothers cannot predict the exact date of conception of their grandchild, we identify the effect of the first grandchild on employment (extensive margin). Our Timing-of-Events approach shows that having a first grandchild increases the probability of leaving prematurely the labor market. This effect is stronger when informal childcare is more valuable to the mother. To estimate the effect of an additional grandchild (intensive margin), we assume that the incidence of a twin birth among the third generation is not correlated with unobserved determinants of the grandmother’s labor supply (first generation). Our respective instrumental variable estimations show a significant effect of further grandchildren. Our results highlight the important influence of the extended family on the decisions of older workers and point to mediating effects of different institutional settings.
    Keywords: Grandchildren, female labor supply, timing of events, instrumental variables
    JEL: J13 J14 J22
    Date: 2017–12
  3. By: Michio Naoi (Faculty of Economics, Keio University); Hideo Akabayashi (Faculty of Economics, Keio University); Ryosuke Nakamura (Faculty of Economics, Fukuoka University); Kayo Nozaki (Faculty of Humanities and Social Sciences); Shinpei Sano (Faculty of Law, Politics and Economics, Chiba University); Wataru Senoh (Faculty of Law, Politics and Economics, Chiba University); Chizuru Shikishima (Faculty of Liberal Arts, Teikyo University)
    Abstract: We examine the causal effects of family income on child outcomes and households'educational spending using panel data of children matched to their parents. Our identification strategy relies on the largely exogenous, discontinuous changes in the Child Allowance Policy in Japan that occurred between 2010 and 2012. We examine whether an exogenous variation in family income due to policy changes in the payment schedule has any causal effects on children's cognitive outcomes and households' educational spending. Our ordinary least squares (OLS) and first-differenced (FD) results show that, in most cases, family income is positively correlated with children's cognitive outcomes and family's educational investment. Our FD ins trumental variable (FD-IV) results, using exogenous changes in child allowance payments as an instrument, show that family income does not have any causal impacts on child outcomes in the short run. This suggests that the positive income effects on cognitive outcomes in OLS and FD models are not causal effects. In comparison, we find some evidence of positive income effects on households' educational spending. To examine the heterogeneous effects, we estimate FD-IV regressions for various population subgroups: those divided by parental education, income levels, children's age, and gender. We find that family income does not have statistically significant impacts on children's cognitive ability, whereas it has significant positive impacts on educational spending for high-income families and girls.
    Keywords: Child allowance, Family income, Educational spending, Cognitive outcome
    JEL: H24 H31 I21 I28 I38
    Date: 2017–11–13
  4. By: Kamhöfer, Daniel A.; Westphal, Matthias
    Abstract: We estimate the effects of college education on female fertility - a so far understudied margin of education, which we instrument by arguably exogenous variation induced through college expansions. While college education reduces the probability of becoming a mother, college-educated mothers have slightly more children than mothers without a college education. Unfolding the effects by the timing of birth reveals a postponement that goes beyond the time in college - indicating a negative earlycareer effect on fertility. Coupled with higher labor-supply and wage returns for nonmothers as compared to mothers the timing effects moreover suggest that career and family are not fully compatible.
    Keywords: Fertility,family planning,education
    JEL: C31 H52 I21 J12 J13
    Date: 2017
  5. By: François Libois (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics, CRED - Centre de Recherche en Economie du Developpement - Facultés Universitaires Notre Dame de la Paix (FUNDP) - Namur); Vincent Somville (Norwegian School of Economics and Business Administration - Norwegian School of Economics and Business Administration, Chr. Michelsen Institute)
    Abstract: Population control policies keep attracting attention: by increasing the household size, having more children would directly contribute to a household’s poverty. Using nationally representative household level data from Nepal, we investigate the links between a household’s fertility decisions and variations in their size and composition. We show that the relationship between number of births and household size is positive when the mothers are young, but becomes negative as the mothers grow older. Elderly couples who had fewer children host, on average, more relatives who are outside the immediate family unit. This result sheds light on the heterogeneous relation between the number of children and household size over the life cycle. It also implies that reductions in a household’s fertility may have an ambiguous impact on its per capita consumption, which depends on how the household’s composition responds to new births and changes over time: in this sample, an old household’s per capita consumption is not affected by the number of births. We use the gender of the first-born child to instrument the total number of consecutive children.
    Keywords: Fertility,Nepal,Household size,Household composition,Poverty
    Date: 2017–12
  6. By: Raiber, Eva
    Abstract: How does future expected fertility affect current educational investment? Theory suggests that expected fertility can impact both returns to education and the resources available for parental consumption. Using policy data about varying eligibility criteria for second child permits during the One-Child-Policy in China, I investigate the effect of eligibility status on fertility and education. In the 1990s, second child permits increased the likelihood of having a second child by 11 percentage points. Being allowed to have a second child increased schooling by 0.7 years on average, an effect that is likely concentrated in the subset of individuals for whom the permit constraint is binding.
    Keywords: Fertility; Schooling Investment; Family Planning; China
    JEL: J13 J24 O15
    Date: 2017–10
  7. By: Alex Bell; Raj Chetty; Xavier Jaravel; Neviana Petkova; John Van Reenen
    Abstract: We characterize the factors that determine who becomes an inventor in America by using de-identified data on 1.2 million inventors from patent records linked to tax records. We establish three sets of results. First, children from high-income (top 1%) families are ten times as likely to become inventors as those from below-median income families. There are similarly large gaps by race and gender. Differences in innate ability, as measured by test scores in early childhood, explain relatively little of these gaps. Second, exposure to innovation during childhood has significant causal effects on children's propensities to become inventors. Growing up in a neighborhood or family with a high innovation rate in a specific technology class leads to a higher probability of patenting in exactly the same technology class. These exposure effects are gender-specific: girls are more likely to become inventors in a particular technology class if they grow up in an area with more female inventors in that technology class. Third, the financial returns to inventions are extremely skewed and highly correlated with their scientific impact, as measured by citations. Consistent with the importance of exposure effects and contrary to standard models of career selection, women and disadvantaged youth are as under-represented among high-impact inventors as they are among inventors as a whole. We develop a simple model of inventors' careers that matches these empirical results. The model implies that increasing exposure to innovation in childhood may have larger impacts on innovation than increasing the financial incentives to innovate, for instance by cutting tax rates. In particular, there are many "lost Einsteins" - individuals who would have had highly impactful inventions had they been exposed to innovation.
    Keywords: inventor, America, innovation
    Date: 2017–12
  8. By: Ewa Cukrowska-Torzewska (Faculty of Economic Sciences, University of Warsaw); Anna Lovasz (Institute of Economics, Centre for Economic and Regional Studies of the Hungarian Academy of Sciences)
    Abstract: We use cross-national data on 26 EU countries to assess how much children and the responsibilities related to them contribute to the gender wage gap, and how institutional elements - especially family policies - affect this relationship. Our analysis is based on a decomposition that reveals what portion of the gender wage gap may be attributed to: (1) the motherhood wage penalty, (2) the fatherhood wage premium, and (3) the gender wage gap among childless individuals. Our findings suggest that the variability in the magnitude of the gaps is closely related to the institutional context, pointing to different reasons behind the gender wage gap and policy implications. Southern EU countries have low gender wage gaps and low motherhood penalties or even premiums. Short leaves, low childcare coverage, and traditional norms do not support maternal labor supply, but mothers who work do not face a wage penalty. Western EU countries with higher childcare coverage, moderate length leaves, supportive norms, and flexible jobs have relatively high maternal employment and mothers are not faced with significant wage penalties. The highest motherhood penalties are found in CEE countries, where long leaves, low childcare availability under age 3, and preferences for within-family care lead to long absences from the labor market. In all countries, irrespective of cultural norms and policies, we find high positive family gaps among men, which drive men’s average wages up, and lead to gender wage inequality.
    Keywords: Family Gap, Gender Wage Gap, Family Policies
    JEL: J13 J22
    Date: 2017

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