Family Formation and the Great Recession
December 2020
Working Paper Number:
CES-20-42R
Abstract
This paper studies how exposure to recessions as a young adult impacts long-term family formation in the context of the Great Recession. Using confidential linked survey data from U.S. Census, I document that exposure to a 1 pp larger unemployment shock in the Great Recession in one's early 20s is associated with a 0.8 pp decline in likelihood of marriage by their early 30s. These effects are not explained by substitution toward cohabitation with unmarried partners, are concentrated among whites, and are notably absent for individuals from high-income families. The estimated effects on fertility are also negative but imprecisely estimated. A back-of-the-envelope exercise suggests that these reductions in family formation may have increased the long-run impact of the Recession on consumption relative to its impact on individual earnings by a considerable extent.
Document Tags and Keywords
Keywords
Keywords are automatically generated using KeyBERT, a powerful and innovative
keyword extraction tool that utilizes BERT embeddings to ensure high-quality and contextually relevant
keywords.
By analyzing the content of working papers, KeyBERT identifies terms and phrases that capture the essence of the
text, highlighting the most significant topics and trends. This approach not only enhances searchability but
provides connections that go beyond potentially domain-specific author-defined keywords.
:
recession,
wealth,
recessionary,
socioeconomic,
decade,
intergenerational,
family,
fertility,
marriage,
divorced,
recession exposure,
couple
Tags
Tags are automatically generated using a pretrained language model from spaCy, which excels at
several tasks, including entity tagging.
The model is able to label words and phrases by part-of-speech,
including "organizations." By filtering for frequent words and phrases labeled as "organizations", papers are
identified to contain references to specific institutions, datasets, and other organizations.
:
Department of Commerce,
Social Security Administration,
National Science Foundation,
Organization for Economic Cooperation and Development,
National Longitudinal Survey of Youth,
Decennial Census,
Chicago Census Research Data Center,
Federal Register,
American Community Survey,
Social Security Number,
Protected Identification Key,
Department of Health and Human Services,
National Academy of Sciences,
Disclosure Review Board,
Person Validation System,
Federal Statistical Research Data Center,
HHS
Similar Working Papers
Similarity between working papers are determined by an unsupervised neural
network model
know as Doc2Vec.
Doc2Vec is a model that represents entire documents as fixed-length vectors, allowing for the
capture of semantic meaning in a way that relates to the context of words within the document. The model learns to
associate a unique vector with each document while simultaneously learning word vectors, enabling tasks such as
document classification, clustering, and similarity detection by preserving the order and structure of words. The
document vectors are compared using cosine similarity/distance to determine the most similar working papers.
Papers identified with 🔥 are in the top 20% of similarity.
The 10 most similar working papers to the working paper 'Family Formation and the Great Recession' are listed below in order of similarity.
-
Working PaperFamily Resources and Human Capital in Economic Downturns🔥
March 2024
Working Paper Number:
CES-24-15
I study how recessions impact the human capital of young adults and how these effects vary over the parent income gradient. Using a novel confidential linked survey dataset from U.S. Census, I document that the negative effects of worse local unemployment shocks on educational attainment are strongly concentrated among middle-class children, with losses in parental home equity being potentially important mechanisms. To probe the aggregate implications of these findings and assess policy implications, I develop a model of selection into college and life-cycle earnings that comprises endogenous parental transfers for education, multiple schooling options, and uncertainty in post-graduation employment outcomes. Simulating a recession in the model produces a 'hollowing out the middle' in lifecycle earnings in the aggregate, and educational borrowing constraints play a key role in this result. Counterfactual policies to expand college access in response to the recession can mitigate these effects but struggle to be cost effective.View Full Paper PDF
-
Working PaperThe Grandkids Aren't Alright: The Intergenerational Effects of Prenatal Pollution Exposure🔥
November 2020
Working Paper Number:
CES-20-36
Evidence shows that environmental quality shapes human capital at birth with long-run effects on health and welfare. Do these effects, in turn, affect the economic opportunities of future generations? Using newly linked survey and administrative data, providing more than 150 million parent/child links, we show that regulation-induced improvements in air quality that an individual experienced in the womb increase the likelihood that their children, the second generation, attend college 40-50 years later. Intergenerational transmission appears to arise from greater parental resources and investments, rather than heritable, biological channels. Our findings suggest that within-generation estimates of marginal damages substantially underestimate the total welfare effects of improving environmental quality and point to the empirical relevance of environmental quality as a contributor to economic opportunity in the United States.View Full Paper PDF
-
Working PaperThe Impact of Parental Resources on Human Capital Investment and Labor Market Outcomes: Evidence from the Great Recession🔥
June 2024
Working Paper Number:
CES-24-34
I study the impact of parents' financial resources during adolescence on postsecondary human capital investment and labor market outcomes, using house value changes during the Great Recession of 2007-2009 as a natural experiment. I use several restricted-access datasets from the U.S. Census Bureau to create a novel dataset that includes intergenerational linkages between children and their parents. This data allows me to exploit house value variation within labor markets, addressing the identification concern that local house values are related to local economic conditions. I find that the average decrease to parents' home values lead to persistent decreases in bachelor's degree attainment of 1.26%, earnings of 1.96%, and full-time employment of 1.32%. Children of parents suffering larger house value shocks are more likely to substitute into two-year degree programs, drop out of college, or be enrolled in a college program in their late 20s.View Full Paper PDF
-
Working PaperThe Timing of Teenage Births: Estimating the Effect on High School Graduation and Later Life Outcomes🔥
January 2016
Working Paper Number:
CES-16-39R
We examine the long-term outcomes for a population of teenage mothers who give birth to their children around the end of their high school year. We compare the mothers whose high school education was interrupted by childbirth, because the child was born before her expected graduation date to mothers who did not experience the same disruption to their education. We find that mothers who give birth during the school year are seven percent less likely to graduate from high school, are less likely to be married, and have more children than their counterparts who gave birth just a few months later. The labor market outcomes for these two sets of teenage mothers are not statistically different, but with a lower likelihood of marriage and more children, the households of the treated mothers are more likely to fall below the poverty threshold. While differences in educational attainment have narrowed over time, the differences in labor market outcomes and family structure have remained stable.View Full Paper PDF
-
Working PaperHead Start and Mothers' Work: Free Child Care or Something More?
March 2018
Working Paper Number:
CES-18-13
Head Start is the largest public pre-school program in the US, but it provides many additional services to families. This paper uses a discontinuity in grant writing assistance in the first year of the Head Start program to identify impacts on the work and welfare usage of mothers. Using restricted Decennial Census and administrative AFDC data I find that Head Start decreases employment rates and hours worked per week for single mothers. I also find a suggestive increase in welfare receipt for single mothers which is confirmed by an increase in the share of administrative welfare case-files that are single mother households. For all mothers combined there are no significant changes in work or welfare use. I also estimate long-run impacts, 10 years after a woman's child was eligible for Head Start. I find large and persistent declines in work for both non-white mothers and single mothers, accompanied by an increase in public assistance income and return to school. I argue that this is consistent with the 1960's era Head Start program's focus on encouraging quality parenting, parent participation and helping families access all benefits for which they were eligible.View Full Paper PDF
-
Working PaperThe Long-Run Effects of Recessions on Education and Income
January 2017
Working Paper Number:
CES-17-52
This paper examines the long-run effects of the 1980-1982 recession on education and income. Using confidential Census data, I estimate generalized difference-in-differences regressions that exploit variation across counties in the severity of the recession and across cohorts in age at the time of the recession. I find that children born in counties with a more severe recession are less likely to obtain a college degree and, as adults, earn less income and experience higher poverty rates. The negative effects on college graduation are most severe and essentially constant for individuals age 0-13 in 1979, suggesting that the underlying mechanisms are a decline in childhood human capital or a long-term decline in parental resources to pay for college. I find little evidence that states with more generous or more progressive transfer systems mitigated these long-run effects. The magnitude of my estimates and the large number of affected individuals suggest that the 1980-1982 recession depresses aggregate economic output today.View Full Paper PDF
-
Working PaperRun Effects of Military Service: Evidence from the 911 Attacks
November 2021
Working Paper Number:
CES-21-36
We investigate the effect of military service on labor market, health and family formation outcomes, leveraging differential changes in enlistment rates brought about by the September 11th attacks (911). Using restricted microdata, we identify hundreds of 'high service" counties in which certain birth-county cohorts exhibit large enlistment responses to 911. We find that individuals born into high service counties between 1977 and 1983 (aged 18-24 at the time of the attack), enlisted at nearly twice the rate of earlier birth cohorts (older than 24 at the time of the attack). These high service birth-county cohorts experienced a 10% increase in wages, decreased unemployment and impacts on other labor market measures as well as key household formation measures including marriage and fertility. We also find increases in the hospitalization and mortality rates. Labor market benefits outweigh mortality costs at standard discount rates.View Full Paper PDF
-
Working PaperDid Timing Matter? Life Cycle Differences in Effects of Exposure to the Great Recession
September 2019
Working Paper Number:
CES-19-25
Exposure to a recession can have persistent, negative consequences, but does the severity of those consequences depend on when in the life cycle a person is exposed? I estimate the effects of exposure to the Great Recession on employment and earnings outcomes for groups defined by year of birth over the ten years following the beginning of the recession. With the exception of the oldest workers, all groups experience reductions in earnings and employment due to local unemployment rate shocks during the recession. Younger workers experience the largest earnings losses in percent terms (up to 13 percent), in part because recession exposure makes them persistently less likely to work for high-paying employers even as their overall employment recovers more quickly than older workers'. Younger workers also experience reductions in earnings and employment due to changes in local labor market structure associated with the recession. These effects are substantially smaller in magnitude but more persistent than the effects of unemployment rate increases.View Full Paper PDF
-
Working PaperThe Impact of College Education on Old-Age Mortality: A Study of Marginal Treatment Effects
January 2017
Working Paper Number:
CES-17-30
Using a newly constructed dataset that links 2000 U.S. Census long-form records to Social Security Administration data files, I evaluate the effect of college education on mortality. In an OLS regression, women and men who have at least some college education have 20% lower mortality rates than those with a high school degree or less. I proceed with an empirical design intended to illuminate the extent to which this relationship is causal, estimating marginal treatment effects (MTEs) using the proximity of the nearest college to individuals' birthplace as an instrument. Results indicate positive selection into college education (in terms of longevity) for both women and men. Selection drives almost all of the mortality gap for women. For men, longevity gains from college attendance are concentrated among individuals with unobserved variables that make them unlikely attend college. This suggests that men who would benefit most from receiving college education in terms of mortality reductions are those who are not attending.View Full Paper PDF
-
Working PaperTrends in Earnings Inequality and Earnings Instability among U.S. Couples: How Important is Assortative Matching?
January 2015
Working Paper Number:
CES-15-04
We examine changes in inequality and instability of the combined earnings of married couples over the 1980-2009 period using two U.S. panel data sets: Social Security earnings data matched to Survey of Income and Program Participation panels (SIPP-SSA) and the Panel Study of Income Dynamics. Relative to male earnings inequality, the inequality of couples' earnings is both lower in levels and rises by a smaller amount. We also find that couples' earnings instability is lower in levels compared to male earnings instability and actually declines in the SIPP-SSA data. While wives' earnings played an important role in dampening the rise in inequality and year-to-year variation in resources at the family level, we find that marital sorting and coordination of labor supply decisions at the family level played a minor role. Comparing actual couples to randomly paired simulated couples, we find very similar trends in earnings inequality and instability.View Full Paper PDF
