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on Unemployment, Inequality and Poverty |
| By: | Thomas F. Epper (Department of Economics, University of Copenhagen, IESEG School of Management, Univ. Lille); Ernst Fehr (Department of Economics, University of Copenhagen, Department of Economics, University of Zürich); Kristoffer B. Hvidberg (Department of Economics, University of Copenhagen,); Claus T. Kreiner (Department of Economics, University of Copenhagen); Søren Leth-Petersen (Department of Economics, University of Copenhagen); Basit Zafar (Department of Economics, University of Michigan) |
| Abstract: | We examine whether individual preferences predict higher education choices. According to standard human capital theory, differences in individuals time and risk preferences lead to differences in educational investments. Testing this hypothesis is challenging, as it requires measuring individuals preferences, doing so before they make educational investments, and subsequently observing their educational choices. We combine incentivized, experimentally elicited measures of time and risk preferences for a large, representative sample of 18–19-year-old Danes with administrative data on subsequent higher education choices, programspecific earnings trajectories, prior school performance, and family background. In line with theory, we find that more patient individuals choose longer education programs and programs with steeper early career earnings profiles, while more risk averse individuals select programs with lower earnings dispersion and reduced downside risk. These relationships remain strong after controlling for cognitive ability, prior academic performance, and family background. Our findings suggest that preferences have a substantial impact on real world educational investments and have implications for educational sorting. |
| Keywords: | Risk Preferences, Time Preferences, Educational Choices |
| JEL: | I23 I24 I26 C91 |
| Date: | 2026–09–09 |
| URL: | https://d.repec.org/n?u=RePEc:kud:kucebi:2618 |
| By: | Costa-Font, Joan (London School of Economics); Jimenez-Martin, Sergi (Universitat Pompeu Fabra); Vilaplana, Cristina (University of Murcia) |
| Abstract: | We estimate the health and wellbeing effects of subsidized access to long-term care (LTC). Our analysis exploits the staggered implementation of Spain’s 2007 System of Autonomy and Care for Dependent People (SAAD), which expanded publicly funded and universal LTC subsidies and supports, as well as its subsequent reform. Using two decades worth of administrative and survey data and leveraging exogenous regional and individual-level variation in program exposure, we find that access to SAAD benefits reduces the care receiver’s depressive symptoms by about 1 percentage point, increases its survival probability by 2.6–3 percentage points, and raises its life satisfaction by 0.24–0.50 scale points. Cost-effectiveness estimates indicate that the implied cost per quality-adjusted life year (QALY) gained lies below commonly accepted efficiency thresholds for public health spending in Europe. These findings document sizeable health returns and efficiency gains from publicly subsidized LTC provision |
| Keywords: | long-term care subsidies, long-term care supports, old age care, Spain, mortality, cost per QALY, survival, mental health, life satisfaction |
| JEL: | I18 J14 J16 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18890 |
| By: | Buser, Thomas (University of Amsterdam); Cappelen, Alexander (NHH Norwegian School of Economics); Gneezy, Uri (Rady School of Management, UCSD); Tungodden, Bertil (NHH Norwegian School of Economics) |
| Abstract: | We provide globally representative evidence on two attitudes toward competition: individuals’ willingness to compete and the importance they attach to boys and girls being willing to compete, using a novel survey module that we fielded as part of the 2022 Gallup World Poll. The data cover more than 66, 000 individuals across 62 countries. Men are more willing to compete than women in all but two countries, and willingness to compete is higher among younger, more educated, and higher-income individuals. Attitudes toward children’s willingness to compete vary substantially across countries, with competitiveness valued more for boys in some countries and for girls in others. Both attitudes are systematically related to the economic and social environment. Individuals exposed to greater inequality or faster population growth during their formative years are more willing to compete and place greater importance on children being willing to compete. Greater exposure to gender equality during formative years is associated with smaller gender gaps in both adults’ willingness to compete and attitudes toward the competitiveness of boys and girls. |
| Keywords: | willingness to compete, gender, global, representative sample, socialization |
| JEL: | D91 J16 J24 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18901 |
| By: | Schack, Trine (Department of Economics and Business Economics, Aarhus University); Meekes, Jordy (Leiden University); Barreto, César (OECD, Paris); Carcillo, Stéphane (Sciences Po, Paris); Fluchtmann, Jonas (OECD); Hijzen, Alexander (OECD); Lochner, Benjamin (FAU Erlangen-Nuremberg); Nibloe, Matthew (UCL); Vejlin, Rune (Aarhus University) |
| Abstract: | We study the incidence, sources, and dynamics of low-wage employment using harmonised linked employer-employee administrative data from Denmark, France, Germany, the Netherlands, Portugal, and the United Kingdom. We examine how worker characteristics, firm-specific wage premia, wage progression, and labour market institutions shape outcomes at different parts of the lower wage distribution. Three main findings emerge. First, worker characteristics account for most of the wage gap facing low-wage workers, though firm-specific wage premia matter too, especially at the very bottom. Firm premia reflect both sorting across industries and pay differences across firms within industries. Second, low-wage employment is at least partly transitory, as workers at the bottom see faster subsequent wage growth and change firms more often. Third, minimum wages and marginal effective tax rates show limited systematic association with wage growth or job-to-job mobility, though higher minimum wages are linked to a smaller share of workers below 70 % of the median. These patterns are broadly similar across countries and point to the joint importance of worker skills and access to higher-paying firms for improving low-wage workers' prospects. |
| Keywords: | low-wage employment, cross-country, matched employer-employee data, wage premia, taxes |
| JEL: | J24 J31 J38 J62 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18891 |
| By: | Cesar Chavez Padilla; Shuaizhang Feng; James J. Heckman; Zhe Yang |
| Abstract: | Using rich data on Chinese schoolchildren, we study the relationships of IQ and personality traits with children’s risk preferences and how they affect the precision with which those preferences are measured. Our structural model separates preferences from deliberation noise and guessing, and relates guessing to deliberation noise. Psychological measures have weak direct influences on preferences but strongly affect deliberation noise and guessing behavior. Shocks to choice have persistent individual-specific components and are not independent. Socioeconomic background has little direct influence on preferences or deliberation noise once traits are accounted for. Background variables affect psychological traits, however. Risk preferences differ across and within genders. For small gambles, girls are less risk averse than boys, but the opposite holds for larger gambles. |
| JEL: | D12 D90 I21 J24 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35526 |