nep-dem New Economics Papers
on Demographic Economics
Issue of 2019‒10‒21
two papers chosen by
Héctor Pifarré i Arolas
Universitat Pompeu Fabra

  1. Untimely Destruction: Pestilence, War and Accumulation in the Long Run By Bell, Clive; Gersbach, Hans; Komarov, Evgenij
  2. An Investment-and-Marriage Model with Differential Fecundity By Hanzhe Zhang

  1. By: Bell, Clive (Heidelberg University); Gersbach, Hans (ETH Zurich); Komarov, Evgenij (ETH Zurich)
    Abstract: This paper analyses the effects of disease and war on the accumulation of human and physical capital. We employ an overlapping-generations frame-work in which young adults, confronted with such hazards and motivated by old-age provision and altruism, make decisions about investments in schooling and reproducible capital. A poverty trap exists for a wide range of stationary war losses and premature adult mortality. If parents are altruistic and their sub-utility function for own consumption is more concave than that for the children's human capital, the only possible steady-state growth path involves full education. Otherwise, steady-state paths with incompletely educated children may exist, some of them stationary ones. We also examine, analytically and with numerical examples, a growing economy's robustness in a stochastic environment. The initial boundary conditions have a strong influence on outcomes in response to a limited sequence of destructive shocks.
    Keywords: premature mortality, capital accumulation and destruction, steady states, poverty traps, overlapping generations
    JEL: D91 E13 I15 I25 O11 O41
    Date: 2019–10
  2. By: Hanzhe Zhang
    Abstract: I build an equilibrium investment-and-marriage model to explain stylized facts about education, income, and marriage for Americans born in the twentieth century that had not been explained in a unified way. The most novel finding is a theoretical explanation for why women attend college at a higher rate and earn a lower average income than men. Differential fecundity and an equilibrium marriage market form the basis of my explanation. The model also accounts for gender-specific relationships between age at marriage and income, as well as the evolving relationship between age at marriage and spousal income for women. I provide evidence to support my theory and calibrate the model to conduct counterfactual analyses.
    Keywords: college gender gap, earnings gender gap, marriage age, nonassortative matching
    JEL: C78 D10
    Date: 2019

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