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on Demographic Economics |
| By: | Emily Nix; Martin Eckhoff Andresen (Statistics Norway) |
| Abstract: | Women experience significant reductions in labor market income following the birth of children, while their male partners experience no such income drops. This “relative child penalty” has been well documented and accounts for a significant amount of the gender income gap. In this paper we do two things. First, we use a simple household model to better understand the potential mechanisms driving the child penalty, which include gender norms around child care, female preferences for child care, efficient specialization within households, and the biological cost of giving birth. The model, combined with the estimated child penalties for heterosexual and same sex couples, suggests that the child penalty experienced by women in heterosexual couples is primarily explained by female preferences for child care and gender norms, with a smaller contribution due to the biological costs of giving birth. Second, we provide causal estimates on the impact of two family policies aimed at reducing the relative child penalty: paternity leave and subsidized early child care. Our precise and robust regression discontinuity results show no significant impact of paternity leave use on the relative child penalty. Early subsidized care seems to have more promise as a policy tool for affecting child penalties, as we find a 25% reduction in child penalties per year of child care use from a large Norwegian reform that expanded access to child care. |
| Keywords: | Gender wage gap; labor supply; child penalty; paternity leave; child care; same sex couples; event study; regression discontinuity; instrumental variables |
| JEL: | I21 J13 J22 J71 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:ssb:dispap:902&r=all |
| By: | Anna Raute (Queen Mary University of London) |
| Abstract: | In this paper, I assess whether earnings-dependent maternity leave positively impacts fertility and narrows the baby gap between highly educated (high-earning) and less-educated (low-earning) women. I exploit a major maternity leave benefit reform in Germany that considerably increased the financial incentives, by up to 21,000 EUR, for highly educated and higher-earning women. Using the large differential changes in maternity leave benefits across education and income groups in a differences-in-differences design, I estimate the causal impact of the reform on fertility for up to 5 years. In addition to demonstrating an up to 23% increase in the fertility of tertiary-educated women, I find a positive, statistically significant effect of increased benefits on fertility, driven mainly by women at the middle and upper end of the earnings distribution. Overall, the results suggest that earnings-dependent maternity leave benefits, which compensate women according to their opportunity cost of childbearing, could successfully reduce the fertility rate disparity related to mothers’ education and earnings. |
| Keywords: | Fertility, fertility gaps, paid maternity leave, opportunity cost |
| JEL: | J13 J16 J18 |
| Date: | 2018–09–30 |
| URL: | http://d.repec.org/n?u=RePEc:qmw:qmwecw:871&r=all |
| By: | Andrew Shephard (Department of Economics, University of Pennsylvania) |
| Abstract: | We present a general discrete choice framework for analyzing household formation and dissolution decisions in an equilibrium limited-commitment collective framework that allows for marriage both within and across birth cohorts. Using Panel Study of Income Dynamics and American Community Survey data, we apply our framework to empirically implement a time allocation model with labor market earnings risk, human capital accumulation, home production activities, fertility, and both within- and across-cohort marital matching. Our model replicates the bivariate marriage distribution by age, and explains some of the most salient life-cycle patterns of marriage, divorce, remarriage, and time allocation behavior. We use our estimated model to quantify the impact of the significant reduction in the gender wage gap since the 1980s on marriage outcomes. |
| Keywords: | Marriage, divorce, collective household models, life-cycle, search and matching, intrahousehold allocation, structural estimation |
| JEL: | C78 D13 D83 J12 J16 J22 J24 J31 |
| Date: | 2019–03–15 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:19-003&r=all |
| By: | Michael J. Böhm; Christian Siegel |
| Abstract: | We argue that rising supply of experience not only reduces experienced workers' relative wages but also their relative labor market participation. From a theoretical model we derive predictions which we quasi-experimentally investigate, using variation across U.S. local labor markets (LLMs) over the last decades and instrumenting experience supply by the LLMs' age structures a decade earlier. We find that aging substantially reduces experienced workers' relative wages and employment rates, and also their labor market participation rates. Our results imply thatthe effect of demographic change on labor markets might be more severe than previously recognized, as it reaches beyond wages. |
| Keywords: | Demographic Change; Employment of Experienced Workers; Return to Experience |
| JEL: | J11 J21 J31 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:ukc:ukcedp:1902&r=all |
| By: | Sandra M. Leitner (The Vienna Institute for International Economic Studies, wiiw); Robert Stehrer (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | Many EU countries are currently undergoing major demographic changes, particularly in terms of shrinking total and working-age populations and population ageing. If this trend is to continue, the functioning of the labour market is at risk as labour shortages are increasingly more likely to emerge which will subsequently imperil further economic growth and catching-up across the EU. This report addresses the likely labour-market consequences of observable demographic trends in the EU. It applies a simple trend-based model which uses observable trends of the past 15 years of the working-age population and the activity rate – which together determine the evolution of the supply of labour – as well as of labour productivity and GDP growth – which together determine the evolution of the demand for labour – to simulate likely scenarios for the future development of labour supply and demand until 2050. Projected future trends in both labour supply and demand are then used to establish whether and – if so – in what year adverse past demographic developments are likely to kick in and begin jeopardising further growth. Different simulation exercises demonstrate that in some EU countries – particularly countries in Central and Eastern Europe – labour supply-side constraints would already materialise in the mid-2020s, which calls for quick policy action to address and ideally avert the imminent demographic collapse. |
| Keywords: | demographic change, labour supply constraints, labour shortages, growth |
| JEL: | J11 J21 J23 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:wii:rpaper:rr:439&r=all |
| By: | Sara McLanahan (Princeton University); Kate Jaeger (Princeton University); Kristin Catena (Princeton University) |
| Abstract: | Families formed by unmarried parents increased dramatically in the United States during the latter half of the twentieth century. To learn more about these families, a team of researchers at Princeton and Columbia Universities designed and implemented a large, birth cohort study –The Fragile Families and Child Wellbeing Study. This chapter highlights several findings from the study. First, most unmarried parents have "high hopes" for a future together at the time of their child’s birth; but their resources are low and most relationships do not last. Second, unmarried mothers experience high levels of partnership instability and family complexity, both of which are associated with lower quality parenting and poorer child well being. Finally, welfare state, child support and criminal justice policies play a large role in the lives of fragile families. |
| Keywords: | unmarried parents, partnership instability,parenting, child well-being, policies |
| JEL: | J12 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:pri:crcwel:wp19-03-ff&r=all |
| By: | Florian Bonnet (ENS Paris Saclay - Ecole Normale Supérieure Paris-Saclay) |
| Date: | 2019–03–14 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-02067193&r=all |
| By: | Foreman-Peck, James (Cardiff Business School); Zhou, Peng (Cardiff Business School) |
| Abstract: | A dynamic stochastic unified growth model is estimated from English economy data for almost a millennium. At the core of the (seven) overlapping generations, rational expectations structure is household choice about target number and quality of children. The trends of births, deaths, population and, the real wage, are closely matched by the estimated model. In the 19th century English fertility transition, the model shows how the generalized child price relative to the child quality price rose. The rising opportunity cost of education was as decisive for the transition as the parental shift to child quality. |
| Keywords: | Economic Development, Demography, Unified Growth, Overlapping Generations, English Economy |
| JEL: | O11 J11 N13 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:cdf:wpaper:2019/8&r=all |