nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2007‒07‒20
four papers chosen by
Maximo Rossi
University of the Republic

  1. Human Capital, Mortality and Fertility: A Unified Theory of the Economic and Demographic Transition By Cervellati, Matteo; Sunde, Uwe
  2. Marriage and Divorce since World War II: Analyzing the Role of Technological Progress on the Formation of Households By Greenwood, Jeremy; Guner, Nezih
  3. "Recent Trends in Household Wealth in the United States: Rising Debt and the Middle-Class Squeeze" By Edward N. Wolff
  4. Migration, remittances, poverty, and human capital : conceptual and empirical challenges By McKenzie, David; Sasin, Marcin J.

  1. By: Cervellati, Matteo; Sunde, Uwe
    Abstract: This paper provides a unified theory of the economic and demographic transition. Individuals make optimal decisions about fertility, education of their children and the type and intensity of the investments in their own education. These decisions are affected by different dimensions of mortality and technological progress which change endogenously during the process of development. The model generates an endogenous transition from a regime characterized by limited human capital formation, little longevity, high child mortality, large fertility and a sluggish income and productivity growth to a modern growth regime in which lower net fertility is associated with the acquisition of human capital and improved living standards. Unlike previous models, the framework emphasizes the education composition of the population in terms of the equilibrium share of educated individuals, and differential fertility related to education. The framework explores the roles of different dimensions of mortality, wages and schooling in triggering the transition. The dynamics of the model are consistent with empirical observations and stylized facts that have been difficult to reconcile so far. For illustration we simulate the model and discuss the novel predictions using historical and cross-country data.
    Keywords: child mortality; demographic transition; endogenous life expectancy; heterogeneous human capital; Long-term development
    JEL: E10 J10 O10 O40 O41
    Date: 2007–07
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:6384&r=ltv
  2. By: Greenwood, Jeremy; Guner, Nezih
    Abstract: Since World War II there has been: (i) a rise in the fraction of time that married households allocate to market work, (ii) an increase in the rate of divorce, and (iii) a decline in the rate of marriage. What can explain this? It is argued here that technological progress in the household sector has saved on the need for labour at home. This makes it more feasible for singles to maintain their own home, and for married women to work. To address this question, a search model of marriage and divorce is developed. Household production benefits from labour-saving technological progress.
    Keywords: Divorce; Hours Worked; Household Production; Marriage; Technological Progress
    JEL: E13 J12 J22 O11
    Date: 2007–07
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:6391&r=ltv
  3. By: Edward N. Wolff
    Abstract: I find here that the early 2000s witnessed both exploding debt and the middle-class squeeze. While median wealth grew briskly in the late 1990s, it fell slightly between 2001 and 2004, while the inequality of net worth increased slightly. Indebtedness, which fell substantially during the late 1990s, skyrocketed in the early 2000s. Among the middle class, the debt-to-income ratio reached its highest level in 20 years. The concentration of investment-type assets generally remained as high in 2004 as during the previous two decades. The racial and ethnic disparity in wealth holdings, after stabilizing during most of the 1990s, widened in the years between 1998 and 2001, but then narrowed during the early 2000s. Wealth also shifted in relative terms, away from young households (particularly those under age 35) and toward those in the 55–64 age group.
    Date: 2007–05
    URL: http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_502&r=ltv
  4. By: McKenzie, David; Sasin, Marcin J.
    Abstract: This paper reviews common challenges faced by researchers interested in measuring the impact of migration and remittances on income, poverty, inequality, and human capital (or, in general, " welfare " ) as well as difficulties confronting development practitioners in converting this research into policy advice. On the analytical side, the paper discusses the proper formulation of a research question, the choice of the analytical tools, as well as the interpretation of the results in the presence of pervasive endogeneity in all decisions surrounding migration. Particular attention is given to the use of instrumental variables in migration research. On the policy side, the paper argues that the private nature of migration and remittances implies a need to carefully spell out the rationale for interventions. It also notices the lack of good migration data and proper evaluations of migration-related government policies. The paper focuses mainly on microeconomic evidence about international migration, but much of the discussion extends to other settings as well.
    Keywords: Population Policies,Health Monitoring & Evaluation,Banks & Banking Reform,Anthropology,Voluntary and Involuntary Resettlement
    Date: 2007–07–01
    URL: http://d.repec.org/n?u=RePEc:wbk:wbrwps:4272&r=ltv

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