Counterfactual Dissimilarity: Can Changes in Demographics and Income Explain Increased Racial Integration in U.S. Cities?

Urban areas in the U.S. have experienced important changes in racial/ethnic distributions over the last two decades. In the average urban area today black-white racial integration has increased by 10.6 percent between 1990 and 2010. Changes in racial and ethnic distributions and gentrification are often associated with changes in residents’ demographic characteristics, such as income, education and age. This paper applies a non-parametric spatial decomposition technique using complete (restricted-use) microdata files from the 1990 Decennial Long Form Census and 2008-2012 American Community Surveys to assess what portion of the changes in racial distributions can be attributed to chang..

Demographic Economics

TRAP'd Teens: Impacts of Abortion Provider Regulations on Fertility & Education

Targeted regulations of abortion providers (TRAP laws) are the fastest growing abortion restriction in the U.S. These often result in clinic closures, limiting abortion access. We study how women's exposure to these laws in adolescence affects their fertility and educational attainment. For this study, we codify the legal history of all TRAP laws ever implemented. We explore the impacts of TRAP laws on teen births using an event-study analysis and stacked differences-in-differences methodology to avoid issues of negative weighting inherent in two-way fixed effects approaches. Consistent with other evidence on abortion access, we find that impacts on births are large and robust for Black wome..

Demographic Economics

The impact of supply-driven variation in time to death on the demand for health care

Many high-income countries have successfully reduced hospital mortality in several acute health conditions. We test the hypothesis that variation in the supply of care directed to saving the life of individuals with a health shock may result in increasing the demand for health care as individuals are likely to contribute to the demand after surviving the health shock. We examined repeated cross-sections of individuals exposed to an AMI or a stroke over a time window of ten years in Denmark. Hospital survival probabilities in the interval 0- 30 days from the shock are used as an indicator of the supply, while individual health care expenditure in the interval 31-365 days is used as an indicat..

Demographic Economics

Migration as a Vector of Economic Losses from Disaster-Affected Areas in the United States

In this paper, we infuse consideration of migration into research on economic losses from extreme weather disasters. Taking a comparative case study approach and using data from the Federal Reserve Bank of New York/Equifax Consumer Credit Panel, we document the size of economic losses via migration from 23 disaster-affected areas in the United States after the most damaging hurricanes, tornadoes, and wildfires on record. We then employ demographic standardization and decomposition to determine if these losses primarily reflect changes in out-migration or changes in the economic resources that migrants take with them (greater economic losses per migrant). Finally, we consider the implications..

Demographic Economics

Health, an ageing labour force, and the economy: does health moderate the relationship between population age-structure and economic growth?

Research often suggests that population ageing will be detrimental for the economy due to increased labour market exits and lost productivity, however the role of population health and disability at older ages is not well established. We estimate the relationship between the size of the older working age population and economic growth across 180 countries from 1990 to 2017 to explore whether a healthy older working age population, as measured by age-specific Years Lived with Disability (YLDs), can moderate the relationship between an ageing labour force and real per capita GDP growth. Using country and year fixed effects models, we find that although an increase in the 55–69 year old share..

Demographic Economics

Market Size and Spatial Growth - Evidence from Germany’s Post-War Population Expulsions

Virtually all theories of economic growth predict a positive relationship between population size and productivity. In this paper I study a particular historical episode to provide direct evidence for the empirical relevance of such scale effects. In the aftermath of the Second World War about 8m ethnic Germans were expelled from their domiciles in Eastern Europe and transferred to West Germany. This inflow increased the German population by almost 20%. Using variation across counties I show that the settlement of refugees had a large and persistent effect on the size of the local population, manufacturing employment and income per capita. I show that these findings are quantitatively consis..

Demographic Economics

Gender Preferences in Job Vacancies and Workplace Gender Diversity

In spring 2005, Austria launched a campaign to inform employers and newspapers that gender preferences in job advertisements were illegal. At the time over 40% of openings on the nation’s largest job-board specified a preferred gender. Over the next year the fraction fell to under 5%. We merge data on filled vacancies to linked employer-employee data to study how the elimination of gender preferences affected hiring and job outcomes. Prior to the campaign, most stated preferences were concordant with the firm’s existing gender composition, but a minority targeted the opposite gender - a subset we call non-stereotypical vacancies. Vacancies with a gender preference were very likely (>90%)..

Demographic Economics

Population Growth and Automation Density: Theory and CrossCountry Evidence

We analyse the effects of declining population growth on automation. Theoretical considerations imply that countries with lower population growth introduce automation technologies faster than those with higher population growth. We test the theoretical implication on panel data for 60 countries over the time span 1993-2013. Regression estimates support the theoretical implication, suggesting that a one percent increase in population growth is associated with an approximately two percent reduction in the growth rate of robot density. Our results are robust to the inclusion of standard control variables, different estimation methods, dynamic specifications, and changes with respect measuring r..

Demographic Economics

Demographic change, secular stagnation and inequality: automation as a blessing?

We construct and calibrate an overlapping generations model incorporating demographic change and the possibility to automate the production process to test the hypothesis put forward by Acemoglu and Restrepo (2017). In line with their hypothesis, we find that ageing is a powerful force stimulating the adoption of automation technologies in OECD economies. Ageing-induced automation is found to soften the negative effects of labour scarcity and rising old-age dependency rates on per capita growth, but the compensation is incomplete. One important reason is that automated tasks are far from perfect substitutes for tasks executed by human labour. A second reason is that ageing-induced automation..

Demographic Economics

The Human Side of Structural Transformation

We document that nearly half of the global decline in agricultural employment during the 20th-century was driven by new cohorts entering the labor market. A newly compiled dataset of policy reforms supports an interpretation of these cohort effects as human capital. Through the lens of a model of frictional labor reallocation, we conclude that human capital growth, both as a mediating factor and as an independent driver, led to a sharp decline in the agricultural labor supply. This decline accounts, at fixed prices, for 40% of the decrease in agricultural employment. This aggregate effect is roughly halved in general equilibrium.

Demographic Economics

The Causal Impact of Taking Parental Leave on Wages: Evidence from 2005 to 2015

Within the context of Luxembourg, we analyze the causal effect of parental leave take up on post-birth hourly wages of an important subpopulation of parental-leave-eligible mothers, i.e., first-time mothers that are always employed regardless of having taken parental leave. In our analysis, we simultaneously address selection of eligible mothers in taking parental leave, and selection of eligible mothers into employment. To deal with the first complication, we assume that conditional on observed pre-intervention covariates there are no unobserved factors associated to both the assignment to parental leave and the potential post-birth hourly wages. To this end, we control for a rich set of pr..

Demographic Economics

A Class of Acceptable and Practical Social Welfare Orderings with Variable Population: Stepwise Social Welfare Orderings and Their Applications

This study proposes a new class of social welfare orderings, a stepwise rank-dependent social welfare ordering, which naturally generalizes a rank-dependent utilitarianism in the setting of social choice with variable population size. In fact, a stepwise social welfare ordering is simply designed to have the same value for each proportion of the population, with the obvious advantage that allows functional form to be freely chosen for assessing well-being inequality. We show that a stepwise rank-dependent social welfare ordering is easily characterized by standard axioms: strong Pareto, anonymity, Pigou-Dalton transfer equity, continuity, rank-separability, and consistency for population rep..

Demographic Economics

Population Growth and Firm Dynamics

Population growth has declined markedly in almost all major economies since the 1970s. We argue this trend has important consequences for the process of firm dynamics and aggregate growth. We study a rich semi-endogenous growth model of firm dynamics, and show analytically that a decline in population growth reduces creative destruction, increases average firm size and concentration, raises market power and misallocation, and lowers aggregate growth in the long-run. We also show lower population growth has positive effects on the level of productivity, making the short-run welfare impacts ambiguous. In a quantitative application to the U.S, we find that the slowdown in population growth sinc..

Demographic Economics

Gendered interpretations of job loss and subsequent professional pathways

While we know that career interruptions shape men’s and women’s professional trajectories, we know less about how job loss may matter for this process. Drawing on interviews with unemployed, college-educated men and women in professional occupations, I show that while both men and women interpret their job loss as due to impersonal “business” decisions, women additionally attribute their job loss as arising from employers’ “personal” decisions. Men’s job loss shapes their subsequent preferred professional pathways, but never in a way that diminishes the importance of their participation in the labor force. For some women in this study, job loss becomes a moment to reflect on ..

Demographic Economics

A radically simple way to monitor life expectancy

NOTE: this is an early registration of the research idea and findings in form of slides for a talk presented at EAPS Mort workshop on 2021-09-22 (video: https://youtu.be/rOndHnuajH4?t=2370) Period Life Expectancy is the key summary measure of current mortality. Elimination of the direct influence of population age structure allows to meaningfully compare mortality levels and changes across the populations and over time. Calculation of life expectancy demands high quality detailed data on death and population counts disaggregated by sex and age. Such data is only available for the more developed countries. Moreover, even in the most developed countries, it becomes available with a considerabl..

Demographic Economics

The casual effect of fertility: The multiple problems with instrumental variables for the number of children in families

Studies investigating how the number of children in a family affects the parents or the children face problems because the variable of interest is endogenous in the model. The currently accepted solution to this problem is to use instrumental variables (IVs), for example, based on twin births. In this paper, I review and add to the critique of IVs based on twin births and show that that there are so many issues—major and minor—with these IVs that results based on them are not reliable or interpretable. I also review other IVs used in the literature, for example IVs based on the sexes of the firstborn children, and conclude that there are, as of yet, no credible IVs for the number of chil..

Demographic Economics

Women’s work and wages in the sixteenth-century and Sweden’s position in the “Little divergence”

We use a unique source from the Swedish royal demesnes to examine the work and relative wages of women in sixteenth century Sweden, an economic laggard in the Early Modern period. The source pertains to workers hired on yearly contracts, a type more representative for historical labour markets than day-labour on large construction sites, and allows us to observe directly the food consumed by workers. We speak to the debate on the “Little Divergence” within Europe as women’s work and gender differentials in pay is a key indicator of women’s relative autonomy and seen as a cause for the economic ascendency of the North Sea region during the period. We find small gender differentials am..

Demographic Economics

Pension design and the failed economics of squirrels

This paper explores the nature of reciprocity between workers and pensioners, starting from the observation that what pensioners consume has mostly to be produced by younger workers, and therefore reciprocity in some form is inherent. The opening section argues that a worker can try to arrange consumption in retirement by (a) storing current production or (b) building claims on future production. However, storing current production (the squirrels model) does not work well, so that the main vehicle is building claims on future production. There are two approaches to doing so – through promises (which lie at the core of Pay-As-You-Go (PAYG) plans), or by accumulating financial assets which c..

Demographic Economics

Inequality in Mortality between Black and White Americans by Age, Place, and Cause, and in Comparison to Europe, 1990-2018

Although there is a large gap between Black and White American life expectancies, the gap fell 48.9% between 1990-2018, mainly due to mortality declines among Black Americans. We examine age-specific mortality trends and racial gaps in life expectancy in rich and poor U.S. areas and with reference to six European countries. Inequalities in life expectancy are starker in the U.S. than in Europe. In 1990 White Americans and Europeans in rich areas had similar overall life expectancy, while life expectancy for White Americans in poor areas was lower. But since then even rich White Americans have lost ground relative to Europeans. Meanwhile, the gap in life expectancy between Black Americans and..

Demographic Economics

The Great Transition: Kuznets Facts for Family-Economists

The 20th century beheld a dramatic transformation of the family. Some Kuznets style facts regarding structural change in the family are presented. Over the course of the 20th century in the United States fertility declined, educational attainment waxed, housework fell, leisure increased, jobs shifted from blue to white collar, and marriage waned. These trends are also observed in the cross-country data. A model is developed, and then calibrated, to address the trends in the US data. The calibration procedure is closely connected to the underlying economic logic. Three drivers of the great transition are considered: neutral technological progress, skilled-biased technological change, and drop..

Demographic Economics

On the Family Origins of Human Capital Formation: Evidence from Donor Children

We introduce a novel strategy to study the intergenerational transmission of human capital, net of genetic skill transfers. For this purpose, we use unique data on children conceived through sperm and egg donation in IVF treatments in Denmark. Because the assignment of donors is not selective, the intergenerational human capital estimates allow for a causal nurture interpretation. Once we take account of genes, we find that only the education of mothers matters: the association between mother's education and child test scores is significant and large, whereas the association between father's education and child test scores is insignificant and practically zero.

Demographic Economics

Population growth and automation density: theory and cross-country evidence

We analyze the effects of declining population growth on automation. Theoretical considerations imply that countries with lower population growth introduce automation technologies faster. We test the theoretical implication on panel data for 60 countries over the time span 1993-2013. Regression estimates support the theoretical implication, suggesting that a 1% increase in population growth is associated with an approximately 2% reduction in the growth rate of robot density. Our results are robust to the inclusion of standard control variables, different estimation methods, dynamic specifications, and changes with respect to the measurement of the stock of robots.

Demographic Economics

The Gender Gap in Earnings Losses after Job Displacement

Existing research has shown that job displacement leads to large and persistent earnings losses for men, but evidence for women is scarce. Using administrative data from Germany, we apply an event study design in combination with propensity score matching and a reweighting technique to directly compare men and women who are displaced from similar jobs and firms. Our results show that after a mass layoff, women’s earnings losses are about 35% higher than men’s, with the gap persisting five years after job displacement. This is partly explained by a higher propensity of women to take up part-time or marginal employment following job loss, but even full-time wage losses are almost 50% (or 5..

Demographic Economics

Behavioral Barriers and the Socioeconomic Gap in Child Care Enrollment

Children with lower socioeconomic status (SES) tend to benefit more from early child care, but are substantially less likely to be enrolled. We study whether reducing behavioral barriers in the application process increases enrollment in child care for lower-SES children. In our RCT in Germany with highly subsidized child care (n > 600), treated families receive application information and personal assistance for applications. For lower-SES families, the treatment increases child care application rates by 21 pp and enrollment rates by 16 pp. Higher-SES families are not affected by the treatment. Thus, alleviating behavioral barriers closes half of the SES gap in early child care enrollment.

Demographic Economics

Inequality in Early Care Experienced by U.S. Children

Using every major nationally-representative dataset on parental and non-parental care provided to children up to age 6, we quantify differences in American children’s care experiences by socioeconomic status (SES), proxied primarily with maternal education. Increasingly, higher-SES children spend less time with their parents and more time in the care of others. Non-parental care for high-SES children is more likely to be in childcare centers, where average quality is higher, and less likely to be provided by relatives where average quality is lower. Even within types of childcare, higher-SES children tend to receive care of higher measured quality and higher cost. Inequality is evident at ..

Demographic Economics

The Great Divide: Education, Despair and Death

Deaths of despair, morbidity and emotional distress continue to rise in the US. The increases are largely borne by those without a four-year college degree—the majority of American adults. For many less-educated Americans, the economy and society are no longer providing the basis for a good life. Concurrently, all-cause mortality in the US is diverging by education—falling for the college-educated and rising for those without a degree—something not seen in other rich countries. We review the rising prevalence of pain, despair, and suicide among Americans without a BA. Pain and despair created a baseline demand for opioids, but the escalation of addiction came from pharma and its politi..

Demographic Economics

The Puzzle of Falling US Birth Rates Since the Great Recession

This paper documents a set of facts about the dramatic decline in birth rates in the United States between 2007 and 2020 and explores possible explanations. The overall reduction in the birth rate reflects declines across many groups of women, including women who differ by race and ethnicity, age, and level of education. The Great Recession contributed to the decline in the early part of this period, but we are unable to identify any other economic, policy, or social factor that has changed since 2007 that is responsible for much of the decline beyond that. Mechanically, the falling birth rate can be attributed to changes in birth patterns across recent cohorts of women moving through childb..

Demographic Economics

The Initial Effects of the Expanded Child Tax Credit on Material Hardship

The transformation of the Child Tax Credit (CTC) into a more generous, inclusive monthly payment marks a historic (temporary) shift in U.S. treatment of low-income families. To investigate the initial impact of these payments, we apply a series of difference-in-difference estimates using Census Household Pulse Survey microdata collected from April 14 through August 16, 2021. Our findings offer three primary conclusions regarding the initial effects of the monthly CTC. First, payments strongly reduced food insufficiency: the initial payments led to a 7.5 percentage point (25 percent) decline in food insufficiency among low-income households with children. Second, the effects on food insuffici..

Demographic Economics

Effect of the Jamaica Early Childhood Stimulation Intervention on Labor Market Outcomes at Age 31

We report the labor market effects of the Jamaica Early Childhood Stimulation intervention at age 31. The study is a small-sample randomized early childhood education stimulation intervention targeting stunted children living in the poor neighborhoods of Kingston, Jamaica. Implemented in 1987-1989, treatment consisted of a two-year home-based intervention designed to improve nutrition and the quality of mother-child interactions to foster cognitive, language and psycho-social skills. The original sample is 127 stunted children between 9 and 24 months old. Our study is able to track and interview 75% of the original sample 30 years after the intervention, both still living in Jamaica and migr..

Demographic Economics

Demographics, Wealth, and Global Imbalances in the Twenty-First Century

We use a sufficient statistic approach to quantify the general equilibrium effects of population aging on wealth accumulation, expected asset returns, and global imbalances. Combining population forecasts with household survey data from 25 countries, we measure the compositional effect of aging: how a changing age distribution affects wealth-to-GDP, holding the age profiles of assets and labor income fixed. In a baseline overlapping generations model this statistic, in conjunction with cross-sectional information and two standard macro parameters, pins down general equilibrium outcomes. Since the compositional effect is positive, large, and heterogeneous across countries, our model predicts ..

Demographic Economics