When Work Disappears: Manufacturing Decline and the Falling Marriage-Market Value of Men

 

By:	David Autor ; David Dorn ; Gordon Hanson
The structure of marriage and child-rearing in U.S. households has undergone two marked shifts in the last three decades: a steep decline in the prevalence of marriage among young adults, and a sharp rise in the fraction of children born to unmarried mothers or living in single-headed households. A potential contributor to both phenomena is the declining labor-market opportunities faced by males, which make them less valuable as marital partners. We exploit large scale, plausibly exogenous labor-demand shocks stemming from rising international manufacturing competition to test how shifts in the supply of young ‘marriageable’ males affect marriage, fertility and children’s living circumstances. Trade shocks to manufacturing industries have differentially negative impacts on the labor market prospects of men and degrade their marriage-market value along multiple dimensions: diminishing their relative earnings—particularly at the lower segment of the distribution—reducing their physical availability in trade-impacted labor markets, and increasing their participation in risky and damaging behaviors. As predicted by a simple model of marital decision-making under uncertainty, we document that adverse shocks to the supply of `marriageable’ men reduce the prevalence of marriage and lower fertility but raise the fraction of children born to young and unwed mothers and living in in poor single-parent households. The falling marriage-market value of young men appears to be a quantitatively important contributor to the rising rate of out-of-wedlock childbearing and single-headed childrearing in the United States.
JEL:	F16 J12 J13 J21 J23
URL:	http://d.repec.org/n?u=RePEc:nbr:nberwo:23173&r=ltv

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The Life-cycle Benefits of an Influential Early Childhood Program

 

By:	García, Jorge Luis (University of Chicago) ; Heckman, James J. (University of Chicago) ; Leaf, Duncan Ermini (University of Southern California) ; Prados, Maria José (University of Southern California)
This paper estimates the long-term benefits from an influential early childhood program targeting disadvantaged families. The program was evaluated by random assignment and followed participants through their mid-30s. It has substantial beneficial impacts on health, children’s future labor incomes, crime, education, and mothers’ labor incomes, with greater monetized benefits for males. Lifetime returns are estimated by pooling multiple data sets using testable economic models. The overall rate of return is 13.7% per annum, and the benefit/cost ratio is 7.3. These estimates are robust to numerous sensitivity analyses.
Keywords:	childcare, early childhood education, long-term predictions, gender differences in responses to programs, health, quality of life, randomized trials, substitution bias
JEL:	J13 I28 C93
URL:	http://d.repec.org/n?u=RePEc:iza:izadps:dp10456&r=ltv

 

Global Inequality Dynamics: New Findings from WID.world

 

By:	Facundo Alvaredo ; Lucas Chancel ; Thomas Piketty ; Emmanuel Saez ; Gabriel Zucman
This paper presents new findings on global inequality dynamics from the World Wealth and Income Database (WID.world), with particular emphasis on the contrast between the trends observed in the United States, China, France, and the United Kingdom. We observe rising top income and wealth shares in nearly all countries in recent decades. But the magnitude of the increase varies substantially, thereby suggesting that different country-specific policies and institutions matter considerably. Long-run wealth inequality dynamics appear to be highly unstable. We stress the need for more democratic transparency on income and wealth dynamics and better access to administrative and financial data.
JEL:	E01 H2 H5 J3
URL:	http://d.repec.org/n?u=RePEc:nbr:nberwo:23119&r=ltv

 

Creative destruction and subjective well-being

 

By:	Philippe Aghion ; Ufuk Akcigit ; Angus Deaton ; Alexandra Roulet
In this paper we analyze the relationship between turnover-driven growth and subjective well-being. Our model of innovation-led growth and unemployment predicts that: (i) the effect of creative destruction on expected individual welfare should be unambiguously positive if we control for unemployment, less so if we do not; (ii) job creation has a positive and job destruction has a negative impact on well-being; (iii) job destruction has a less negative impact in areas with more generous unemployment insurance policies; and (iv) job creation has a more positive effect on individuals that are more forward-looking. The empirical analysis using cross sectional MSA (metropolitan statistical area)-level and individual-level data provide empirical support to these predictions.
JEL:	I31 J63 J65 O33 O38
URL:	http://d.repec.org/n?u=RePEc:ehl:lserod:69228&r=ltv

Dynastic human capital, inequality and intergenerational mobility

 

By:	Adermon, Adrian (IFAU – Institute for Evaluation of Labour Market and Education Policy) ; Lindahl, Mikael (Department of Economics, University of Gothenburg; IFAU; IZA; UCLS; CESifo) ; Palme, Mårten (Department of economics, Stockholm University; IZA)
We study the importance of the extended family – or the dynasty – for the persistence in human capital inequality across generations. We use data including the entire Swedish population, linking four generations. This data structure enables us to – in addition to parents, grandparents and great grandparents – identify parents’ siblings and cousins, as well as their spouses, and the spouses’ siblings. We introduce and estimate a new parameter, which we call the intergenerational transmission of dynastic inequality. This parameter measures the between-dynasty variation in intergenerational transmission of human capital. We use three different measures of human capital: years of schooling, family income and an index of occupational status. Our results show that traditional parent-child estimates miss about half of the persistence across generations estimated by the extended model.
Keywords:	intergenerational mobility; extended family; dynasty; human capital
JEL:	I24 J62
URL:	http://d.repec.org/n?u=RePEc:hhs:ifauwp:2016_019&r=ltv

 

An Analysis of the Labor Market for Uber’s Driver-Partners in the United States

 

By:	Jonathan V. Hall ; Alan B. Krueger
Uber, the ride-sharing company launched in 2010, has grown at an exponential rate. This paper provides the first comprehensive analysis of the labor market for Uber’s driver-partners, based on both survey and administrative data. Drivers who partner with Uber appear to be attracted to the platform largely because of the flexibility it offers, the level of compensation, and the fact that earnings per hour do not vary much with the number of hours worked. Uber’s driver-partners are more similar in terms of their age and education to the general workforce than to taxi drivers and chauffeurs. Most of Uber’s driver-partners had full- or part-time employment prior to joining Uber, and many continued in those positions after starting to drive with the Uber platform, which makes the flexibility to set their own hours all the more valuable. Uber’s driver-partners also often cited the desire to smooth fluctuations in their income as a reason for partnering with Uber.
JEL:	J01
URL:	http://d.repec.org/n?u=RePEc:nbr:nberwo:22843&r=ltv

What’s the good of education on our overall quality of life?: a simultaneous equation model of education and life satisfaction for Australia

 

By:	Nattavudh Powdthavee ; Warn N. Lekfuangfu ; Mark Wooden
Many economists and educators favour public support for education on the premise that education improves the overall quality of life of citizens. However, little is known about the different pathways through which education shapes people’s satisfaction with life overall. One reason for this is because previous studies have traditionally analysed the effect of education on life satisfaction using single-equation models that ignore interrelationships between different theoretical explanatory variables. In order to advance our understanding of how education may be related to overall quality of life, the current study estimates a structural equation model using nationally representative data for Australia to obtain the direct and indirect associations between education and life satisfaction through five different adult outcomes: income, employment, marriage, children, and health. Although we find the estimated direct (or net) effect of education on life satisfaction to be negative and statistically significant in Australia, the total indirect effect is positive, sizeable and statistically significant for both men and women. This implies that misleading conclusions regarding the influence of education on life satisfaction might be obtained if only single-equation models were used in the analysis.
Keywords:	Australia; indirect effect; education; structural equation model; life satisfaction; HILDA
JEL:	I20 I32
URL:	http://d.repec.org/n?u=RePEc:ehl:lserod:61801&r=ltv

Individual Well-Being and the Allocation of Time Before and After the Boston Marathon Terrorist Bombing

By:	Andrew Clark (PSE – Paris-Jourdan Sciences Economiques – ENS Paris – École normale supérieure – Paris – INRA – Institut National de la Recherche Agronomique – EHESS – École des hautes études en sciences sociales – École des Ponts ParisTech (ENPC) – CNRS – Centre National de la Recherche Scientifique, PSE – Paris School of Economics) ; Elena Stancanelli (PSE – Paris School of Economics, CES – Centre d’économie de la Sorbonne – UP1 – Université Panthéon-Sorbonne – CNRS – Centre National de la Recherche Scientifique)
There is a small literature on the economic costs of terrorism. We consider the effects of the Boston marathon bombing on Americans’ well-being and time allocation. We exploit data from the American Time Use Survey and Well-Being Module in the days around the terrorist attack to implement a regression-discontinuity design. The bombing led to a significant and large drop of about 1.5 points in well-being, on a scale of one to six, for residents of the States close to Boston. The happiness of American women also dropped significantly, by almost a point, regardless of the State of residence. Labor supply and other time use were not significantly affected. We find no well-being effect of the Sandy Hook shootings, suggesting that terrorism is different in nature from other violent deaths.
Keywords:	Well-being,Time Use,Terrorism
URL:	http://d.repec.org/n?u=RePEc:hal:psewpa:hal-01302843&r=ltv

Is Global Equality the Enemy of National Equality?

By:	Rodrik, Dani
The bulk of global inequality is accounted for by income differences across countries rather than within countries. Expanding trade with China has aggravated inequality in some advanced economies, while ameliorating global inequality. But the ‘China shock’ is receding and other low-income countries are unlikely to replicate China’s export-oriented industrialization experience. Relaxing restrictions on cross-border labor mobility might have an even stronger positive effect on global inequality. However it also raises a similar tension. While there would likely be adverse effects on low-skill workers in the advanced economies, international labor mobility has some advantages compared to further liberalizing international trade in goods. I argue that none of the contending perspectives — national-egalitarian, cosmopolitan, utilitarian — provides on its own an adequate frame for evaluating the consequences.
URL:	http://d.repec.org/n?u=RePEc:cpr:ceprdp:11812&r=ltv

 

Segregation of women into low-paying occupations in the US

 

By:	Carlos Gradín (Universidade de Vigo and EQUALITAS, Spain)
We present an approach to measure the stratification of occupations by sex. For that, we extend the conventional framework for measuring gender segregation to take into account the quality of jobs (e.g. average earnings) predominantly held by each sex. We complement segregation curves and measures derived from them, with their associated concentration curves and indices, to determine whether women are segregated into low-paying jobs. We investigate with this approach the long-term trends of gender segregation and stratification of occupations by sex in the US using census data. Our results show that de-stratification of occupations by sex was more intense than their desegregation, and lasted longer, even after segregation had stagnated. Neither segregation nor stratification levels can be explained by the different characteristics of male and female workforces, although the profound changes in the composition of workers over time (e.g. education, marital status) did help to substantially explain their trends. Changes in the earnings structure favoring occupations held by women since 1980 additionally contributed to reduce stratification over time. Finally, changes in the conditional occupational distribution by sex only reduced segregation and stratification before 1990.
Keywords:	occupational segregation, stratification, low-paying occupations, gender.
JEL:	J16 J42 J71 J82
URL:	http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2017-426&r=ltv