does education affect risk aversion evidence from the british education reform individual risk attitudes are frequently used to predict decisions regarding education however using risk attitudes as a control variable for decisions about education has been criticized because of the potential for reverse causality causality between risk aversion and education is unclear and disentangling the different directions it may run is difficult in this study we make the first attempt to investigate the causal effects of education on risk aversion by examining the british education reform of 1972 which increased the duration of compulsory schooling from age 15 to age 16 using regression discontinuity design we find that this additional year of schooling increases the level of risk aversion which is contrary to previous findings in the literature and we also find that this result is particularly strong for individuals with less education this positive causal effect of education on risk aversion might alleviate concerns regarding the endogeneity reverse causality issue when using risk aversion as an explanatory variable for decisions about education the sign would remain credible because the coefficients are underestimated

maternal education home environments and the development of children and adolescents we study the intergenerational effects of maternal education on children s cognitive achievement behavioral problems grade repetition and obesity we address endogeneity of maternal schooling by instrumenting with variation in schooling costs when the mother grew up using matched data from the female participants of the national longitudinal survey of youth 1979 nlsy79 and their children we can control for mother s ability and family background factors our results show substantial intergenerational returns to education for children aged 7 8 for example our iv results indicate that an additional year of mother s schooling increases the child s performance on a standardized math test by almost 0 1 of a standard deviation and reduces the incidence of behavioral problems our data set allows us to study a large array of channels which may transmit the effect of maternal education to the child including family environment and parental investments at different ages of the child we find that income effects delayed childbearing and assortative mating are likely to be important and we show that maternal education leads to substantial differences in maternal labor supply we investigate heterogeneity in returns and we present results focusing both on very early stages in the child s life as well as adolescent outcomes we present a falsification exercise to support the validity of our instruments and our results are found to be robust in a sensitivity analysis we discuss policy implications and relate our findings to intergenerational mobility

government spending shocks and rule of thumb consumers with steady state inequality in the body of literature concerning fiscal policy a central result is that government spending might stimulate private consumption because only some households save while others spend their entire income each period although such heterogeneity naturally causes inequality this complication is commonly avoided by assuming that transfers redistribute steady state wealth i show that this steady state assumption drives short run results without redistribution the equilibrium is indeterminate and the labor market structure that is imposed to support the expansive result is theoretically inconsistent on a more positive note i propose a labor market formulation under which the expansive effects of government spending might arise

the nature and nurture of economic outcomes this paper uses data on adopted children to examine the relative importance of biology and environment in determining educational and labor market outcomes i employ three long term panel data sets which contain information on adopted children their adoptive parents and their biological parents in at least two of the three data sets the mechanism for assigning children to adoptive parents is fairly random and does not match children to adoptive parents based on health race or ability i find that adoptive parents education and income have a modest impact on child test scores but a large impact on college attendance marital status and earnings in contrast with existing work on iq scores i do not find that the influence of adoptive parents declines with child age this abstract was borrowed from another version of this item

government spending and the taylor principle this paper explores how government size affects the scope for equilibrium indeterminacy in a new keynesian economy where part of the population live hand to mouth the main result is that a higher level of public consumption is likely to generate indeterminacy and render the taylor principle insufficient as criterion for equilibrium uniqueness this holds even though fiscal policy serves to reduce swings in current income only if government consumption is a substitute for private consumption will it narrow the scope for indeterminacy hence monetary policy should be conducted with an eye to the amount and composition of government consumption

early maternal time investment and early child outcomes using large longitudinal survey data from the uk millennium cohort study this article estimates the relationship between maternal time inputs and early child development we find that maternal time is a quantitatively important determinant of skill formation and that its effect declines with child age there is evidence of long term effects of early maternal time inputs on later outcomes especially in the case of cognitive skill development in the case of non cognitive development the evidence of this long term impact disappears when we account for skill persistence

education choices and returns on the labor and marriage markets evidence from data on subjective expectations in this paper we analyze the role of expected labor and marriage market returns as determinants of the college enrollment decisions of mexican high school graduates moreover we investigate whether the relative weights of these factors differ by gender we use data on individuals expectations regarding future labor market outcomes which we directly elicited from the youths and two different measures of marriage market returns first marriage market returns are proxied by the net supply of potential partners in the youths local marriage markets second we use data which elicits youths beliefs about their future spouse s earnings conditional on their own education level we find that labor market as well as marriage market returns are important determinants of the college enrollment decision however boys and girls preferences differ in terms of the relative role of the two determinants in that the relative weight of labor market versus marriage market returns is larger for boys than for girls

does increasing women s schooling raise the schooling of the next generation the positive cross sectional relationship between the schooling of mothers and their children is substantially biased upward due to correlations between schooling and heritable ability as well as assortative mating an increase in the schooling of women would not have beneficial effects in terms of the schooling of children increased maternal schooling leads to reduced home time for mothers anticipating the consequences of investing in women s schooling requires attention to the role that schooling plays in the marriage market as well as to opportunities in the labor market for women

does school tracking affect equality of opportunity new international evidence this paper investigates whether the interaction between family background and secondary school tracking affects human capital accumulation a widely shared view is that more tracking reinforces the role of parental privilege and thereby reduces equality of opportunities this may occur for several reasons including peer effects more talented students are gathered together teacher sorting better teachers prefer teaching better students differences in curricula academic oriented schools like the german gymnasium the french lycee the british grammar school or the italian liceo teach abilities that increase the probability of entering college and or differences in resource endowment compared to the current literature which focuses on early outcomes such as test scores at 13 and 15 years old we look at later outcomes including literacy dropout rates college enrolment employability and earnings while we do confirm the common view that school tracking reinforces the impact of family background when looking at educational attainment and labour market outcomes we do not confirm the same results when studying its impact on literacy and on the job training overall school tracking has an ambiguous effect in our sample of countries on the one hand and consistently with the previous literature tracking has a detrimental impact on educational attainment because it prevents some individuals from further progressing to the tertiary level of education the diversion effect on the other hand the curricula offered in vocational schools seem more effective in promoting further training and adult competences the specialization effect thereby reducing the impact of parental background on these two outcomes thus reducing the extent of student tracking either by raising the age of first selection or by reducing the number of tracks available may be appropriate for increasing intergenerational mobility in educational attainment but may increase social exclusion for people from disadvantaged backgrounds giorgio brunello and daniele checchi

the intergenerational transmission of maternal human capital and the gender gap in educational attainment abstract an intergenerational effect of maternal and not paternal human capital on offspring s human capital production is a mechanism that induces males and females to attain different education levels this mechanism allows for explanations of the reversal in the gender education gap

intergenerational transmission of risk attitudes a revealed preference approach using data the german socio economic panel gsoep we investigate whether the willingness to take risks which is revealed via observed choices of occupation is transmitted from parents to children our approach resembles the one by dohmen et al 2008 who investigate the same question using stated preferences as risk variable we use earnings risk measured by the cross sectional coecient of residual variation obtained from mincerian wage regressions we nd that fathers riskiness of the job chosen is a signicant determinant of sons occupational risk our results are robust to dierent specications underpinning the hypothesis of intergenerational transmission of risk preferences

shocking behavior random wealth in antebellum georgia and human capital across generations does the lack of wealth constrain parents investments in the human capital of their descendants we conduct a nearly fifty year followup of an episode in which such constraints would have been plausibly relaxed by a random allocation of substantial wealth to families we track descendants of participants in georgia s cherokee land lottery of 1832 in which nearly every adult white male in georgia took part winners received close to the median level of wealth a large financial windfall orthogonal to participants underlying characteristics that might have also affected their children s human capital although winners had slightly more children than non winners they did not send them to school more sons of winners have no better adult outcomes wealth income literacy than the sons of non winners and winners grandchildren do not have higher literacy or school attendance than non winners grandchildren this suggests only a limited role for family financial resources in the formation of human capital in the next generations in this environment and a potentially more important role for other factors that persist through family lines

measuring heterogeneity in the returns to education using an education reform abstract in this paper we explore the impact of a mandatory education reform as well as pre reform availability of schools above the mandatory level on educational attainment and returns to education in norway we contribute to the existing literature by focusing on the heterogeneity of the impact of reforms our results indicate that increased compulsory education from seven to nine years increased the general level of education beyond the compulsory education we also find that the effect of family background on educational attainment was weaker after the reform the average treatment effect on returns to education is surprisingly high for education of intermediate duration this means that increasing the general level of education potentially generates high returns in the form of wages we also find that the effect of treatment on the treated on the returns to education is 1 4 percentage points higher than the average treatment effect

intergenerational transmission of education and mediating channels evidence from a compulsory schooling reform in germany in this paper i estimate the causal effect that an additional year of schooling for parents has on their children s education by exploiting a compulsory schooling reform that was implemented in all west german states between 1946 and 1969 although previous research indicates that the reform had no effect on earnings i find that an additional year of schooling for women strongly affects the education of their sons there is no effect for the other parent child gender pairs i investigate numerous channels that might mediate the positive effect of the education of mothers most importantly i find that individuals with more schooling value their children s educational success as more important

education gender gaps in pakistan is the labor market to blame abstract differential labor market returns to male and female education are one potential explanation for large gender gaps in education in pakistan we empirically test this explanation by estimating private returns to education separately for male and female wage earners this article contributes to the literature by using a variety of methodologies ordinary least squares heckman correction two stage least squares and household fixed effects in order to estimate economic returns to education the latest nationally representative data the pakistan integrated household survey 2002 are used earnings function estimates consistently reveal a sizable gender asymmetry in economic returns to education with returns to women s education being substantially and statistically significantly higher than men s the return to an additional year of schooling ranges between 7 and 11 for men and between 13 and 18 for women there are also large direct returns to women s education at low levels of schooling

fiscal stimulus and the role of wage rigidity abstract in this paper we study the impact of an expansion in public spending in an economy characterized by limited asset market participation and sticky wages the flexible wage version of the model implies strong expansionary effects on output and consumption but also a counterfactual increase in real wages the introduction of sticky wages besides being a realistic addition solves this problem and preserves the expansionary effects on output and consumption moreover once we introduce segmentation in the labor market sticky wages are even essential to obtain expansionary effects

effective tax rates in macroeconomics cross country estimates of tax rates on factor incomes and consumption abstract this paper proposes a method for computing tax rates using national accounts and revenue statistics using this method we construct time series of tax rates for large industrial countries the method identifies the revenue raised by different taxes at the general government level and defines aggregate measures of the corresponding tax bases this method yields estimates of effective tax rates on factor incomes and consumption consistent with the tax distortions faced by a representative agent in a general equilibrium framework these tax rates compare favorably with existing estimates of marginal tax rates and highlight important international differences in tax policy

local intergenerational mobility abstract using nlsy data we investigate whether the observed patterns of economic mobility as measured by income and educational attainment exhibit heterogeneity across socioeconomic groups and whether the nature of the heterogeneity can be explained by different levels of persistence in the intergenerational transmission of cognitive and non cognitive abilities across these groups in doing so we employ the varying coefficient model vcm to estimate nonparametric local measures of intergenerational mobility of those outcome variables by local we mean that the persistence coefficients are modeled as smooth functions of log parental permanent income our findings show that intergenerational mobility exhibits nonlinear patterns individuals with different parental income are characterized by different degrees of intergenerational mobility moreover we find evidence that suggests cognitive abilities play a role in explaining intergenerational mobility these findings provide some support for a new class of family investment models that emphasize the role of such abilities in economic mobility

mother s education and the intergenerational transmission of human capital evidence from college openings we examine the effect of maternal education on birth outcomes using vital statistics natality data from 1970 to 1999 we also assess the importance of four channels through which maternal education may improve birth outcomes use of prenatal care smoking marriage and fertility in an effort to account for the endogeneity of education attainment we use data about the availability of colleges in the womans country in her 17th year as an instrument for maternal education we find that higher maternal education improves infant health as measured by birth weight and gestational age it also increases the probability that a new mother is married reduces parity increases use of prenatal care and reduces smoking suggesting that may be important pathways for the ultimate effect on health our results add to the growing body of literature which suggests that estimates of the returns to education which focus only on increases in wages understate the total return

compulsory education and the benefits of schooling causal estimates of the benefits of increased schooling using u s state schooling laws as instruments typically rely on specifications which assume common trends across states in the factors affecting different birth cohorts differential changes across states during this period such as relative school quality improvements suggest that this assumption may fail to hold across a number of outcomes including wages unemployment and divorce we find that statistically significant causal estimates become insignificant and in many instances wrong signed when allowing year of birth effects to vary across regions

the general equilibrium effects of fiscal policy estimates for the euro area abstract this paper describes a dynamic stochastic general equilibrium model featuring a fraction of non ricardian agents in order to estimate the effects of fiscal policy in the euro area the model takes into account distortionary taxation on labor and capital income and on consumption while expenditures are broken down into purchases of goods and services compensation of public employees and transfers to households a newly computed quarterly data set of fiscal variables is used our results point to the prevalence of mild keynesian effects of public expenditures in particular although innovations in fiscal policy variables tend to be rather persistent government purchases of goods and services and compensations for public employees have small and short lived expansionary effects on private consumption while innovations in transfers to households show a slightly more sizeable and lasting effect the effects are more significant on the revenue side decreases in labor income and consumption tax rates have sizeable effects on consumption and output while a reduction in capital income tax favors investment and output in the medium run finally our estimates suggest that fiscal policy variables contribute little to the cyclical variability of the main macro variables

rule of thumb consumers meet sticky wages it has been argued that rule of thumb consumers substantially alter the determinacy properties of simple interest rate rules and the dynamics of an otherwise standard new keynesian model in this paper we show that nominal wage stickiness helps re establishing standard results key findings are that wage stickiness i affects the shape of determinacy regions in the parameters space restoring the relevance of the taylor principle for the conduct of monetary policy ii implies that a rise in consumption in response to an innovation in government spending is not a robust feature of the model

does having a cadre parent pay evidence from the first job offers of chinese college graduates abstract we estimate the wage premium associated with having a cadre parent in china using a recent survey of college graduates carried out by the authors the wage premium of having a cadre parent is 15 and this premium cannot be explained by other observables such as college entrance exam scores quality of colleges and majors a full set of college human capital attributes and job characteristics these results suggest that the remaining premium could be the true wage premium of having a cadre parent

education skills and a good job a multidimensional econometric analysis abstract education skills and labor market outcomes are tightly linked most empirical evidence about their interconnections is obtained using rich longitudinal datasets coming from developed countries and often treat earnings as the sole outcome of interest much less is known about the same in developing countries due to lack of appropriate data this paper is an attempt to fill this gap by operationalizing the technology of skill formation framework using a static dataset with some information on past variables following the theoretical underpinnings of modern development paradigms we define our variable of interest to be a multidimensional concept of work related well being going beyond wages to include employment opportunities decent working time and safe work environment we thus apply a suitably adapted version of the above framework resulting in a simultaneous equation model with latent variables to bolivian data we find that an above average well being in terms of employment opportunities and earnings is only observed in the top most quintile of the skills distributions whereas the top three quintiles are relatively well off in the safe work dimension overwork is responsive to cognitive skills but not to non cognitive skills and it is highly prevalent across the entire distribution of the former these two types of skills are also differently influenced by education an individual with a primary schooling is already in the above average group in terms of non cognitive skills a condition requiring an undergraduate college degree in the case of cognitive skills from a policy perspective we note that contrary to the general findings in a developed country context the premium for cognitive skills on the labor market is higher than that for non cognitive skills this can be explained by the relative scarcity of the former which is mostly acquired through formal education a situation often encountered in many developing countries

early late or never when does parental education impact child outcomes we estimate the causal effect of parents education on their children s education and examine the timing of the impact we identify the causal effect by exploiting the exogenous shift in parents education levels induced by the 1972 minimum school leaving age reform in england increasing parental education has a positive causal effect on children s outcomes that is evident in preschool assessments at age 4 and continues to be visible up to and including high stakes examinations taken at age 16 children of parents affected by the reform attain results around 0 1 standard deviations higher than those whose parents were not impacted

why the apple doesn t fall far understanding intergenerational transmission of human capital parents with higher education levels have children with higher education levels however is this because parental education actually changes the outcomes of children suggesting an important spillover of education policies or is it merely that more able individuals who have higher education also have more able children this paper proposes to answer this question with a unique dataset from norway using the reform of the education system that was implemented in different municipalities at different times in the 1960s as an instrument for parental education we find little evidence of a causal relationship between parents education and children s education despite significant ols relationships we find 2sls estimates that are consistently lower than the ols estimates with the only statistically significant effect being a positive relationship between mother s education and son s education these findings suggest that the high correlations between parents and children s education are due primarily to family characteristics and inherited ability and not education spillovers

the intergenerational transmission of risk and trust attitudes recent theories endogenize the attitude endowments of individuals assuming that they are shaped by the attitudes of parents and other role models this paper tests empirically for the relevance of three aspects of the attitude transmission process highlighted in this theoretical literature 1 transmission of attitudes from parents to children 2 an impact of prevailing attitudes in the local environment on child attitudes and 3 positive assortative mating of parents which enhances the ability of a parent to pass on his or her attitudes to the child we focus on two fundamentally important attitudes willingness to take risks and willingness to trust others we find empirical support for all three aspects providing an empirical underpinning for the literature an investigation of underlying mechanisms shows that socialization is important in the transmission process various parental characteristics and aspects of family structure are found to strengthen the socialization process with implications for modeling the socialization production function and for policies focused on affecting children s non cognitive skills the paper also provides evidence that the transmission of risk and trust attitudes affects a wide variety of child outcomes implying a potentially large total effect on children s economic situation

galton versus the human capital approach to inheritance a century ago francis galton proposed a simple yet powerful model of inheritance gary backer s human capital model is often used to analyze important empirical and policy questions but does it dominate galton s from a positive point of view i derive nine implicatiions of the human capital approach that are distinct from galton s evidence from the pis scf and nlsy micro data sets as well as results reported in previous literatures suggest that four of the unique implications are refuted two implications are verified and mixed results are obtained for three others some extensions of economics recently developed by becker and others when applied to inheritance may improve economics predictions

research and development voluntary export restriction and tariffs abstract the effect of trade policy on domestic research development r d in oligopolistic markets is shown to depend on the nature of policy instruments tariffs or non tariff barriers when the r d investment has uncertain consequences on marginal cost a voluntary export restriction ver decreases innovation by the domestic firm as compared to the free trade level this result holds both under cournot and bertrand competition a tariff increases r d investment it is a new rationale for southern firms to prefer ver as a policy instrument besides the well known argument that it facilitates collusion

how large are the effects from changes in family environment a study of korean american adoptees i analyze a new set of data on korean american adoptees who were quasi randomly assigned to adoptive families i find large effects on adoptees education income and health from assignment to parents with more education and from assignment to smaller families parental education and family size are significantly more correlated with adoptee outcomes than are parental income or neighborhood characteristics outcomes such as drinking smoking and the selectivity of college attended are more determined by nurture than is educational attainment using the standard behavioral genetics variance decomposition i find that shared family environment explains 14 percent of the variation in educational attainment 35 percent ofthe variation in college selectivity and 33 percent of the variation in drinking behavior

family background and income during the rise of the welfare state brother correlations in income for swedish men born 1932 1968 we investigate if the association between family background and income in sweden has changed for men born between 1932 and 1968 our main finding is that the share of the variance in long run income that is attributable to family background the so called brother correlation in income has fallen by some 17 from 0 49 for the cohorts of brothers born in the early 1930s to below 0 32 for the cohorts born around 1950 from then on the correlations have inched back up to around 0 37 we report suggestive evidence that the decline is driven by changes in education

the intergenerational transmission of income volatility is riskiness inherited this article examines the intergenerational transmission of income risk do risky parents have risky kids income volatility a proxy for income risk is not observed directly instead it must be estimated with substantial error from the time series variability of income i characterize an income process with individual specific volatility parameters and estimate the joint distribution of volatility parameters for fathers and for their adult sons in data from the panel study of income dynamics fathers with higher income volatility have sons with higher income volatility this finding is correlated with but far from fully explained by the intergenerational transmission of risk tolerance and of the propensity for self employment

length of compulsory education and voter turnout evidence from a staged reform this study estimates the impact of education on voter turnout the identification relies on a reform which increased the length of compulsory schooling in norway from seven to nine years the impact is measured both at the individual and the municipality level both sets of analysis suggest that additional education has no effect on voter turnout the impact of education on various measures of civic outcomes is also estimated of these only the likelihood of signing a petition is found to be positively affected by education

the legacy of immigration labour market performance and education in the second generation previous research finds that the children of immigrants or the second generation earn at least as much as other native born but that there are persistent ethnic differences in the intergenerational transmission of education and wages we explain why these results are not incompatible and extend the empirical evidence in several directions using the canadian survey of labour and income dynamics first we estimate a model of wages earnings and hours worked using modern econometric techniques to corroborate earlier us results of complete integration by the second generation in the labour market we find that ethnic differences in labour market performance are significant but that these difference do not alter conclusions about the relative performance of the second generation second we find a source of superior labour market performance for the second generation in higher educational attainment which constitutes an important legacy of immigration that should not be ignored third we find that the de

when measure matters coresidency truncation bias and intergenerational mobility in developing countries biases from truncation caused by coresidency restriction have been a challenge for research on intergenerational mobility estimates of intergenerational schooling persistence from two data sets show that the intergenerational regression coefficient the most widely used measure is severely biased downward in coresident samples but the bias in intergenerational correlation is much smaller and is less sensitive to the coresidency rate the paper provides explanations for these results comparison of intergenerational mobility based on the intergenerational regression coefficient across countries gender and over time can be misleading much progress on intergenerational mobility in developing countries can be made with the available data by focusing on intergenerational correlation

gender differences in educational attainment evidence on the role of tracking from a finnish quasi experiment this paper studies the relationship between the timing of tracking of pupils into vocational and academic secondary education and gender differences in educational attainment and income we argue that in a system that streams students into vocational and academic tracks relatively late age 15 16 girls are more likely to choose the academic track than boys because of gender differences in the timing of puberty we exploit the finnish comprehensive school reform of the 1970 s to analyze this hypothesis this reform postponed the tracking of students from the age of 10 11 to 15 16 and was adopted gradually by municipalities so that we can observe members of the same cohorts in both systems we find that the postponement of the tracking age increased gender differences in the probability of choosing the academic secondary education and in the probability of continuing into academic tertiary education the reform had particularily negative effects on boys from non academic family backgrounds finally the reform decreased the gender wage gap in adult income by four percentage points

the effect of sibship size on educational attainment in china period variations in industrialized nations sibship size generally depresses educational attainment the larger the number of siblings the lower the educational attainment presumably because of the reduction of family resources both material and intellectual available to each child however this association is much less consistent in developing nations and there is some evidence of substantial change over time in this paper we study the effect of number of siblings on educational attainment in china a nation that has experienced sharp vacillations between policies designed to promote equality between urban and rural residents and between men and women and policies designed to promote economic development the implementation of these policies in the educational arena has alternately reduced and increased competition for educational resources and we show has correspondingly reduced and increased the effect of the number of children in a family on their educational attainment

the savers spenders theory of fiscal policy the macroeconomic analysis of fiscal policy is usually based on one of two canonical models the barro ramsey model of infinitely lived families or the diamond samuelson model of overlapping generations this paper argues that neither model is satisfactory and suggests an alternative in the proposed model some consumers plan ahead for themselves and their descendants while others live paycheck to paycheck this model is easier to reconcile with the essential facts about consumer behavior and wealth accumulation and it yields some new and surprising conclusions about fiscal policy

intergenerational mobility in britain in this paper we use longitudinal data on children and their parents to assess the extent of intergenerational mobility in britain based on data from the national child development survey a cohort of all individuals born in a week of march 1958 we find that the extent of intergenerational mobility is limited we report an intergenerational correlation of the order 40 to 60 for fathers and sons and 45 to 70 for fathers and daughters in terms of labour market earnings and years of schooling an examination of quartile transition matrices between parental and child earnings outcomes reveals a similar pattern finally it seems on the basis of these transition matrices that there is an important asymmetry in intergenerational earnings mobility with upward mobility from the bottom of the earnings distribution being more likely than downward mobility from the top

unemployment fiscal multipliers we estimate the effects of fiscal policy on the labor market in us data an increase in government spending of 1 percent of gdp generates output and unemployment multipliers respectively of about 1 2 percent at one year and 0 6 percentage points at the peak each percentage point increase in gdp produces an increase in employment of about 1 3 million jobs total hours employment and the job finding probability all rise whereas the separation rate falls a standard neoclassical model augmented with search and matching frictions in the labor market largely fails in reproducing the size of the output multiplier whereas it can produce a realistic unemployment multiplier but only under a special parameterization extending the model to strengthen the complementarity in preferences to include unemployment benefits real wage rigidity and or debt financing with distortionary taxation only worsens the picture new keynesian features only marginally magnify the size of the multipliers when complementarity is coupled with price stickiness however the magnification effect can be large

free primary education fertility and women s access to the labor market evidence from ethiopia this article investigates the causal relationship between women s schooling and fertility by exploiting variation generated by the removal of school fees in ethiopia the increase in schooling caused by the reform is identified using both geographic variation in the intensity of its impact and temporal variation generated by the timing of the implementation the model finds that the removal of school fees led to an increase in schooling for ethiopian women and that each additional year of schooling led to a reduction in fertility an investigation of the underlying mechanisms linking schooling and fertility finds that the decline in fertility is associated with an increase in labor market opportunity and a reduction in women s ideal number of children

limited asset markets participation monetary policy and inverted aggregate demand logic abstract this paper incorporates limited asset markets participation in dynamic general equilibrium and develops a simple analytical framework for monetary policy analysis aggregate dynamics and stability properties of an otherwise standard business cycle model depend nonlinearly on the degree of asset market participation while moderate participation rates strengthen the role of monetary policy low enough participation causes an inversion of results dictated by conventional wisdom the slope of the is curve changes sign the taylor principle is inverted optimal welfare maximizing discretionary monetary policy requires a passive policy rule and the effects and propagation of shocks are changed however a targeting rule implementing optimal policy under commitment delivers equilibrium determinacy regardless of the degree of asset market participation our results may justify fed s behavior during the great inflation period

priceless the nonpecuniary benefits of schooling copyright 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 by the american economic association permission to make digital or hard copies of part or all of american economic association publications for personal or classroom use is granted without fee provided that copies are not distributed for profit or direct commercial advantage and that copies show this notice on the first page or initial screen of a display along with the full citation including the name of the author copyrights for components of this work owned by others than aea must be honored abstracting with credit is permitted the author has the right to republish post on servers redistribute to lists and use any component of this work in other works for others to do so requires prior specific permission and or a fee permissions may be requested from the american economic association administrative office by going to the contact us form and choosing copyright permissions request from the menu copyright 2016 aea

education and fertility evidence from a natural experiment declining fertility is often attributed to the increased education of women it is difficult to establish a causal link because both fertility and education have changed secularly in this paper we study the connection between fertility and education using educational reform as an instrument to control for selection our results indicate that increasing education leads to postponement of first births away from teenage motherhood and towards women having their first birth in their 20s as well as for a smaller group up to the age of 35 40 we find no evidence however that more education results in more women remaining childless or having fewer children

environmental policy and human capital inequality a matter of life and death abstract this paper analyzes the economic implications of an environmental policy when we account for the life expectancy of heterogeneous agents in a framework in which everyone suffers from pollution but health status also depends on individual human capital we find that the economy may be stuck in a trap in which inequality rises steadily especially when the initial pollution intensity of production is too high we emphasize that such inequality is in the long run costly for the economy in terms of health and growth therefore we study whether a tax on pollution associated with an investment in pollution abatement can be used to address this situation we show that a stricter environmental policy may allow the economy to escape from the inequality trap while enhancing the long term growth rate when the initial inequality in human capital is not too large

the intergenerational transmission of education and equality of educational opportunity in east and west germany socialist societies often emphasized the abolition of traditional social classes to achieve this objective educational opportunities were at times actively managed and allocated to children of less educated parents what happened to these patterns after the demise of socialist rule in eastern europe we study the development of educational mobility after the fall of the iron curtain in east germany and compare the relevance of parental educational background for secondary schooling in east and west germany based on the data from the german mikrozensus we find that educational mobility is lower in east than in west germany and that it has been falling in east germany after unification while the educational advantage of girls declined over time having many siblings presents a more substantial disadvantage in east than in west germany

educational reform ability and family background in this paper we evaluate the impact of a major school reform that took place in the 1950s in sweden on educational attainment and earnings the reform which has many common elements with reforms in other european countries including the uk consisted of increasing compulsor schooling imposing a national curriculum and abolishing selection by ability into academic and non academic streams at the age of 12 comprehensive school reform our data combines survey data with administrative sources we find that the reform increased both the educational attainment and the earnings of children whose fathers had just compulsory education however the earnings of those with educated parents declined possibly because of a dilution of quality at the top end of the education levels the overall effect of the reform was however positive

school tracking and intergenerational income mobility evidence from the finnish comprehensive school reform abstract this paper estimates the effect of a major education reform on intergenerational income mobility the finnish comprehensive school reform of 1972 1977 replaced the old two track school system with a uniform nine year comprehensive school and shifted the selection of students to vocational and academic tracks from age 11 to age 16 we estimate the effect of this reform on the intergenerational income elasticity using a representative sample of males born between 1960 and 1966 the identification strategy relies on a differences in differences approach and exploits the fact that the reform was implemented gradually across the country during a six year period the results indicate that the reform reduced the intergenerational income elasticity by 23 from the pre reform elasticity of 0 30 to post reform elasticity of 0 23

the intergenerational effects of parental higher education evidence from changes in university accessibility abstract we examine the causal relationship between the educational attainment of parents and that of their children using quasi experimental variation from changes in parents access to university generated by the geographical expansion of the finnish university system between the late 1950s and early 1970s our results suggest that for the children of parents affected by the changes in university accessibility there is a strong positive spillover effect of around 0 5 from parent s to child s attained years of education our analyses using alternative parental and child outcomes suggest that the effect of parental education is partly driven by assortative mating and may also be related to children s improved school performance

life cycle earnings education premiums and internal rates of return using norwegian population panel data with nearly career long earnings histories we provide a detailed picture of the causal relationship between schooling and earnings over the life cycle to address selection bias we apply three commonly used identification strategies we find that additional schooling gives higher lifetime earnings and a steeper age earnings profile in line with predictions from human capital theory our preferred estimates imply an internal rate of return of around 11 suggesting that it was highly profitable to acquire additional schooling our analysis reveals that mincer regressions dramatically understate the returns to schooling because key assumptions are violated

education and household welfare abstractusing census data from nepal we examine how the partial derivatives of predicted household welfare vary with parental education we focus on fertility child survival schooling and child labor female education is not as strongly associated with beneficial outcomes as is often assumed male education often matters more and part of the association between female education and welfare is driven by marriage market matching with more educated men controlling for the average education of parental cohorts does not change this finding but when we use educational rank to proxy for unobserved ability and family background the positive association between female education and beneficial outcomes becomes weaker or is reversed for women the association between educational rank and outcomes is strong women who obtain more schooling than their peers in school have fewer children and educate them better in contrast for men the statistical association between education and household welfare remains str

new keynesian versus old keynesian government spending multipliers renewed interest in fiscal policy has increased the use of quantitative models to evaluate policy because of modelling uncertainty it is essential that policy evaluations be robust to alternative assumptions we find that models currently being used in practice to evaluate fiscal policy stimulus proposals are not robust government spending multipliers in an alternative empirically estimated and widely cited new keynesian model are much smaller than in these old keynesian models the estimated stimulus is extremely small with gdp and employment effects only one sixth as large and with private sector employment impacts likely to be even smaller we investigate the sensitivity of our findings with regard to the response of monetary policy the zero bound on nominal interest rates and the inclusion of an empirically relevant degree of rule of thumb behaviour in the new keynesian model in addition we relate our findings using estimated structural macroeconomic models to the recent literature using reduced form regression techniques

ethnic externalities in education and second generation immigrants i analyse the role of ethnic and native human capital defined respectively as the average years of schooling of ethnic groups and of natives within a specific region and of ethnic concentrations in the educational attainment of second generation immigrants in germany compared to natives children parents education has a small and insignificant effect on second generation immigrants education ethnic concentrations have a negative effect while ethnic capital is insignificant the effect of native capital too is insignificant but much larger in magnitude than the effect of ethnic capital for women mother s education is relatively more important for men ethnic concentrations constitute a stronger impediment to educational attainment than for women