nep-dem New Economics Papers
on Demographic Economics
Issue of 2023‒05‒01
nine papers chosen by
Héctor Pifarré i Arolas
University of Wisconsin

  1. Maximum Impact Intergenerational Associations By Sadegh Eshaghnia; James J. Heckman; Rasmus Landersø
  2. Spillover Effects of Old-Age Pension across Generations: Family Labor Supply and Child Outcomes By Katja M. Kaufmann; Yasemin Özdemir; Han Ye
  3. How Will COVID Affect Completed Fertility? By Anqi Chen; Nilufer Gok; Alicia H. Munnell
  4. Demographic Origins of the Decline in Labor’s Share By Andrew Glover; Jacob Short
  5. Educational tracking and the polygenic prediction of education By Hannu Lahtinen; Pekka Martikainen; Kaarina Korhonen; Tim T. Morris; Mikko Myrskylä
  6. Demographic change, national saving and international capital flows By Liu, Weifeng Larry
  7. Structural Labour Market Change, Cognitive Work, and Fertility in Germany By Honorata Bogusz; Anna Matysiak; Michaela Kreyenfeld
  8. What Matters for Annuity Demand: Objective Life Expectancy or Subjective Survival Pessimism? By Karolos Arapakis; Gal Wettstein
  9. Global flows and rates of international migration of scholars By Aliakbar Akbaritabar; Tom Theile; Emilio Zagheni

  1. By: Sadegh Eshaghnia; James J. Heckman; Rasmus Landersø
    Abstract: This paper presents a new approach to measuring the intergenerational transmission of well-being and a novel perspective on which measures and what age ranges to use to estimate intergenerational social mobility. We select the measures and the age ranges that best predict important human capital outcomes of children. The predictive power of parental resources varies among measures of parental resources as well as the age ranges used to measure them. Lifetime measures outperform traditional snapshot proxies for lifetime incomes based on income flows at certain age windows in predicting child outcomes, regardless of the ages when child outcomes are measured. The sensitivity of IGE estimates to the ages at which parental resources are measured is far smaller than their sensitivity to whether lifetime measures are used or whether snapshot measures are used. We also find that the financial resources of parents compensate in part for nonmonetary inputs to child human capital such as the stability of the family and education of parents. We interpret our estimates using the technology of skill formation modified to account for the emergence of new skills in adolescence.
    JEL: D31 I24 I30
    Date: 2023–03
  2. By: Katja M. Kaufmann; Yasemin Özdemir; Han Ye
    Abstract: We study the impact of grandparental retirement decisions on family members’ labor supply and child outcomes by exploiting a Dutch pension reform in a fuzzy Regression Discontinuity design. A one-hour increase in grandmothers’ hours worked causes adult daughters with young children to work half an hour less. Daughters without children, with older children and sons/daughters-in-law are not affected. We show important long-run impacts on maternal labor supply and on the child penalty. Test score effects are positive for children aged 4-7 (substitution from grandparental to maternal care), and negative for children aged 11-12 (substitution from grandparental to formal childcare).
    Keywords: spillover effects, retirement, grandparental childcare, maternal labor supply, child development
    JEL: J13 J22 J26 I38 D64
    Date: 2023–03
  3. By: Anqi Chen; Nilufer Gok; Alicia H. Munnell
    Abstract: Birth rates in the United States have been declining since the Great Recession, and many thought that COVID-19 might accelerate this decline. And, indeed, birth rates early in the pandemic did drop substantially. However, when the economy swiftly recovered from COVID, birth rates in 2021 ticked up for the first time since 2014. The question is what happens next: is this uptick simply a temporary blip or a sign that the decade-long decline in fertility rates is over? To assess how COVID might affect completed fertility, this brief, based on a recent paper, uses a twopronged approach. First, it examines the change in birth rates by age in 2020 and 2021 using data from the National Vital Statistics System to quantify the recent COVID-era changes in birth rates. Second, to shed light on fertility trends going forward, the analysis turns from recent birth patterns, which represent a snapshot for any given year, to expectations data, which suggest how many children women anticipate having overall. The discussion proceeds as follows. The first section provides some background on fertility trends and expectations. The second section describes the data and methodology. The third section presents results for the two separate approaches. The first shows that the pandemic resulted in a large initial decline in fertility in late 2020, but by the end of 2021, COVID’s independent impact on fertility was actually positive. The second finds that, according to early data on fertility expectations, the ideal number of kids has dropped sharply for women in their 20s and held steady for women in their 30s; and evidence from the Great Recession suggests that fertility will not rise as they age. If the drop in expectations holds in more comprehensive surveys, birth rates are likely to keep falling, and at a faster pace than before COVID. The final section concludes that a lower fertility rate will likely result in a smaller workforce, slower economic growth, and higher required tax rates for pay-as-you-go programs such as Social Security, but it also reflects the evolving preferences of women today.
    Date: 2023–01
  4. By: Andrew Glover; Jacob Short
    Abstract: Since 1980, the earnings share of older workers has risen in the United States. At the same time, labor’s share of income has declined significantly. We hypothesize that an aging workforce has contributed to the decline in labor’s share of income. We formalize this hypothesis in an on-the-job search model in which employers of older workers may have substantial monopsony power due to the decline in labor market dynamism that accompanies aging. The greater monopsony power manifests as a growing wedge between a worker’s earnings and their marginal product over the life cycle. We estimate the profile of these wedges using cross-industry variation in labor’s share and the age distribution of earnings. We find that a 60-year-old worker receives half the marginal product relative to when they were 20. Together with recent demographic trends, this can account for 59% of the recent decline in labor’s share of earnings in the United States.
    Keywords: Labour markets; Productivity
    JEL: D33 E25 J1 J3 J62
    Date: 2023–04
  5. By: Hannu Lahtinen; Pekka Martikainen (Max Planck Institute for Demographic Research, Rostock, Germany); Kaarina Korhonen; Tim T. Morris; Mikko Myrskylä (Max Planck Institute for Demographic Research, Rostock, Germany)
    Abstract: Although it is well known that individuals’ genetics relate to their educational attainment, our understanding of how this may vary across differing educational institutional contexts is limited. In an educational system that does not separate students into different tracks early on, individuals’ unique skills and interests may have more time to manifest, which could potentially strengthen the genetic prediction of education. We test such a hypothesis exploiting the natural experiment of the Finnish comprehensive school reform employed gradually and regionally across the country between 1972 and 1977, using genetically informed population-representative surveys linked to data from administrative registers. We observed that the genetic prediction of education was stronger after the reform by one-third among men and those coming from low-educated families. We observed no evidence for reform effects among women or those from high-educated families. The increase in genetic prediction was particularly pronounced among the first cohort experiencing the new system. From the perspective of genetic prediction, the reform to a more universalist curriculum was successful in promoting equality of opportunity. The results also highlight the potential of various turbulent circumstances – such as puberty or ongoing restructuring of institutional practices – in magnifying genetic effects.
    JEL: J1 Z0
    Date: 2023
  6. By: Liu, Weifeng Larry
    Abstract: This paper explores the impacts of demographic change on national saving and international capital flows. Introducing demographic structure and pension systems into a four-stage overlapping-generation model of a small open economy, the paper derives analytical solutions which link a wide range of factors to national saving and the current account. This framework enables tractable analysis of the effects of various demographic shocks on national saving and external balances, and also of the interaction between demographic shocks and productivity growth and pension systems. The demographic impacts on national saving and capital flows depend on the nature of demographic shocks (fertility or mortality; transitory, permanent or persistent) and on the stage of demographic shocks, as well as productivity growth and pension structure.
    Keywords: International Relations/Trade, International Relations/Trade
    Date: 2022
  7. By: Honorata Bogusz (University of Warsaw, Faculty of Economic Sciences); Anna Matysiak (University of Warsaw, Faculty of Economic Sciences); Michaela Kreyenfeld (Hertie School)
    Abstract: Technological change and globalisation have been transforming the structure of labour demand in favour of workers performing cognitive tasks. Even though past research has found that labour force participation is an important determinant of fertility behaviour, few studies have addressed the fertility effects of the long-term structural changes of labour market. To fill this gap, we measure the cognitive task content of work at the occupation level using data from the Employment Survey of the German Federal Institute for Vocational Education and Training (BiBB). We link this contextual information with employment and fertility histories of women and men from the German Socio-Economic Panel 1984-2018 (GSOEP). With event history models, we find that fertility transitions of men working in occupations characterised by high cognitive task intensity are accelerated. We also observe elevated birth risks among women in occupations requiring cognitive labour. However, this pattern is more ambiguous, as we find that non-working women also experience elevated birth rates.
    Keywords: structural labour market change, cognitive work, task content of work, fertility, Germany
    JEL: J01 J11 J13
    Date: 2023
  8. By: Karolos Arapakis; Gal Wettstein
    Abstract: Objective life expectancy and subjective survival pessimism (defined as the difference between objective and subjective life expectancy) may both affect the demand for annuities. The question this project answers is: how do these two explanations contribute to annuitization decisions in practice? To explore this question, the analysis estimates regression models that include objective life expectancy, subjective survival pessimism, and other characteristics that are linked to annuitization decisions. The results show that, as one would expect, individuals with higher objective life expectancy are more likely to buy an annuity. Similarly, less pessimistic individuals are also more likely to buy an annuity. A one-year rise in objective life expectancy increases the probability of buying an annuity product by 0.20 percentage points, which is nearly nine times larger than a one-year decline in pessimism.
    Date: 2023–01
  9. By: Aliakbar Akbaritabar (Max Planck Institute for Demographic Research, Rostock, Germany); Tom Theile (Max Planck Institute for Demographic Research, Rostock, Germany); Emilio Zagheni (Max Planck Institute for Demographic Research, Rostock, Germany)
    Abstract: Lack of reliable and comprehensive migration data is one of the major reasons that prevents advancements in our understanding of the causes and consequences of migration processes, including for specific groups like high-skilled migrants. We leverage large-scale bibliometric data from Scopus and OpenAlex to trace the global movements of a specific group of innovators: scholars. We developed pre-processing steps and offered best practices for the measurement and identification of migration events from bibliometric data. Our results show a high level of correlation between the count of scholars in Scopus and OpenAlex for most countries. While the magnitude of observed migration events in OpenAlex is larger than in Scopus, the bilateral flows among top pairs of origin and destination countries are consistent in the two databases. Even though OpenAlex has a higher coverage of non-Western countries, the highest correlations with Scopus are observed in Western countries. We share our aggregated estimates of international migration rates, and bilateral flows, at the country level, and expect that our estimates will enable researchers to improve our understanding of the causes and consequences of migration of scholars, and to forecast the future mobility of global academic talent.
    Keywords: Europe, World, international migration, migration, migration flow
    JEL: J1 Z0
    Date: 2023

This nep-dem issue is ©2023 by Héctor Pifarré i Arolas. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.