Research
Macroeconomics, Family Economics, Consumer Credit, Growth, Development and Demography
Research Summary
For a summary of my research, check out my ERC grant Gender Differences: A Macroeconomic Perspective, as well as my NSF grant Macro Models of Household Formation and Fertility,my slides at the Yrjö Jahnsson Award lecture and my NSF CAREER grant Macroeconomic Implications of Gender Roles and Consumer Credit Markets .
See also this research agenda published in the Economic Dynamics Newsletter, my current CRC project, my Google Scholar Profile and this audio slideshow (German).
Here you can find a recent discussion on the role of gender, household behaviour and family economics.
Working Papers/ Work in Progress
What is the Aggregate Impact of Pandemic Education Disruptions in Low-Income Countries?, with Titan Alon, Matthias Doepke and Kristina Manysheva, work in progress.
This Time It's Different: The Role of Women's Employment in a Pandemic Recession, with Titan Alon, Matthias Doepke and Jane Olmstead-Rumsey, CEPR DP No. 15149, August 2020.
The Short-Run Macro Implications of School and Child-Care Closures, with Nicola Fuchs-Schündeln and Moritz Kuhn, IZA DP No. 13353, May 2020.
Optimal Age-based Policies for Pandemics: An Economic Analysis of Covid-19 and Beyond,
with Luiz Brotherhood, Philipp Kircher and Cezar Santos,
Revised and resubmitted at the Review of Economic Studies, December 2023.
Asymmetric Information in Couples, with Matthias Doepke, work in progress.
Parental Control and Fertility History, with Alice Schoonbroodt, work in progress.
Domestic Violence over the Business Cycle, SLIDES, VIDEO, with Gerard van den Berg and Bettina Siflinger, work in progress, December 2012.
Published and Forthcoming Papers
Consumer Credit with Over-Optimistic Borrowers,
with Florian Exler,
Jim MacGee and Igor Livshits
Journal of the European Economic Association, accepted.
Status Externalities in Education and Low Birth Rates in Korea,
with Seongeun Kim and Minchul Yum
American Economic Review, June 2024.
How Families Matter for Understanding Economic Inequality,
with Cezar Santos,
Oxford Open Economics, Vol. 3, Issue Supplement 1, i678-i683, July 2024.
The Economics of Fertility: A New Era,
with Matthias Doepke,
Anne Hannusch and
Fabian Kindermann,
Chapter in Handbook of the Economics of the Family, Vol. 1, 151-254, March 2023.
The Economics of Women's Rights,
with Matthias Doepke,
Anne Hannusch and
Laura Montenbruck,
Journal of the European Economic Association, Vol. 20(6), 2271-2316, December 2022.
Covid-19 und das Arbeitsmarktverhalten von Frauen und Männern
Perspektiven der Wirtschaftspolitik; 23(1): 10-19, March 2022.
Gendered Impacts of Covid-19 in Developing Countries,
with Titan Alon,
Matthias Doepke and
Kristina Manysheva,
AEA Papers and Proceedings, Vol. 112, 272-276, May 2022.
From Mancession to Shecession: Women's Employment in Regular and Pandemic Recessions,
with Titan Alon,
Sena Coskun,
Matthias Doepke and
David Koll,
NBER Macroeconomics Annual 2021, Volume 36, May 2022.
Consumer Debt and Default: A Macro Perspective,
with Florian Exler,
Oxford Research Encyclopedia of Economics and Finance, October 2020.
The Impact of COVID-19 on Gender Equality,
with Titan Alon, Matthias Doepke and Jane Olmstead-Rumsey,
Covid Economics: Vetted and Real-Time Papers, Issue 4, 62-85, April 2020.
Does Female Empowerment Promote Economic Development?,
with Matthias Doepke,
Journal of Economic Growth, Vol.24(4), 309-343, December 2019.
An Equilibrium Model of the African HIV/AIDS Epidemic,
with Jeremy Greenwood, Philipp Kircher and Cezar Santos,
Econometrica, Vol. 87, No. 4, 1081–1113, July 2019.
Women's Empowerment, the Gender Gap in Desired Fertility, and Fertility Outcomes in Developing Countries,
with Matthias Doepke,
The American Economic Review, Papers and Proceedings, May 2018.
The Role of Marriage in Fighting HIV: A Quantitative Illustration for Malawi,
with Jeremy Greenwood, Philipp Kircher and Cezar Santos,
The American Economic Review, Papers and Proceedings, 2017.
Families in Macroeconomics,
with Matthias Doepke,
Chapter in Handbook of Macroeconomics, Volume 2, 1-2693, edited by John B. Taylor and Harald Uhlig, Elsevier B.V., December 2016.
The Democratization of Credit and the Rise in Consumer Bankruptcies,
with Igor Livshits and James MacGee,
Review of Economic Studies, Vol. 83 (4), 1673-1710, 2016.
Gender Gaps in Completed Fertility,
with Erica Field, Vera Molitor and Alice Schoonbroodt,
Journal of Demographic Economics, Vol. 82(02), 167-206. June 2016.
The Association Between Own Unemployment and Female Victimization Among Female Youths,
with Gerard van den Berg,
Journal of Economics and Statistics, Special Issue, JBNST - Vol. 235/4+5, 499-513, 2015.
Property Rights and Efficiency in OLG Models with Endogenous Fertility,
with Alice Schoonbroodt,
Journal of Economic Theory, Vol. 150, 551–582, March 2014.
The Economics and Politics of Women's Rights,
with Matthias Doepke and Alessandra Voena,
Annual Review of Economics, Vol. 4, 339-372, July 2012.
Families as Roommates: Changes in U.S. Household Size,
with Todd Schoellman and Alejandrina Salcedo,
Quantitative Economics, 2012, Vol. 3, 122-175, March 2012.
Accounting for the Rise in Consumer Bankruptcies,
with Igor Livshits and Jim MacGee,
American Economic Journal: Macro, Vol. 2, No. 2, 165-193, April 2010.
Fertility Theories: Can they explain the Negative Fertility-Income Relationship?,
with Larry E. Jones and Alice Schoonbroodt,
Chapter in Demography and the Economy, 43-100, edited by John Shoven, University of Chicago Press, November 2010. (Also available as NBER Working Paper # 14266.)
Women's Liberation: What's in it for Men?,
with Matthias Doepke,
Quarterly Journal of Economics, Vol. 124, No. 4, 1541-1591, November 2009.
A Note on Marriage Market Clearing,
with Urvi Neelakantan,
Economic Letters, Vol 101, pp. 103-105, June 2008.
An Economic History of Fertility in the U.S.: 1826-1960,
with Larry E. Jones,
Chapter in book Frontiers of Family Economics, Vol. 1 edited by Peter Rupert, Emerald Press, 2008. (Also available as NBER Working Paper No. 12796.)
Efficiency with Endogenous Population Growth,
with Mikhail Golosov and Larry E. Jones ,
Econometrica, Vol 75 (4), 1039-1071, July 2007.
Consumer Bankruptcy - A Fresh Start,
with Igor Livshits and Jim MacGee,
The American Economic Review, Vol. 97 (1), 402-418, March 2007.
Polygyny, Women's Rights, and Development
Journal of the European Economic Association, Vol. 4(2-3), 523-530, May 2006.
Marriage Laws and Growth in Sub-Saharan Africa,
with Todd Schoellman,
The American Economic Review, Papers and Proceedings, Vol. 96(2), 295-298, May 2006.
Polygyny, Fertility, and Savings, Journal of Political Economy, Vol.113 (6), 1341-1371, December 2005.
IPUMS - CPS , An Integrated Version of the March Current Population Survey, 1962-2002,
with Miriam L. King,
Historical Methods, Vol. 36, 35-40, Winter 2003.
How families matter for understanding economic inequality
with Cezar Santos
Oxford Open Economics, Vol. 3, Issue Supplement 1, i678–i683, July 2024.
The IFS Deaton Review, May 2023.
Keywords: Inequality, Family Economics
The paper: (Oxford Open Economics) [ Link ]
(The IFS Deaton Review) [ Link ]
The Economics of Women's Rights
with Matthias Doepke, Anne Hannusch and Laura Montenbruck
Journal of the European Economic Association, Vol. 20(6), 2271-2316, December 2022.
Abstract: Two centuries ago, in most countries around the world, women were unable to vote, had no say over their own children or property, and could not obtain a divorce. Women have gradually gained rights in many areas of life, and this legal expansion has been closely intertwined with economic development. We aim to understand the drivers behind these reforms. To this end, we distinguish between four types of women’s rights - economic, political, labor, and body - and document their evolution over the past 50 years across countries. We summarize the political-economy mechanisms that link economic development to changes in women’s rights and show empirically that these mechanisms account for a large share of the variation in women’s rights across countries and over time.
Keywords: Women’s Rights, Female Suffrage, Family Economics, Bargaining, Political Economy
The paper: [ PDF ]
NBER Working Paper No. 30617: [ PDF ]
Presentation Slides (Marshall Lecture, EEA-ESEM Milano 2022): [ PDF ]
Replication Files (December 2022): [ zip file ]
Extended Data Set (February 2023): [ zip file ]
A non-technical summary: The origins of women's rights (published on VoxEU)
Media coverage: Frankfurter Allgemeine Zeitung
The Economics of Fertility: A New Era
with Matthias Doepke, Anne Hannusch and Fabian Kindermann
Chapter in Handbook of the Economics of the Family, Vol. 1, 151-254, edited by Shelly Lundberg and Alessandra Voena, Elsevier B.V., March 2023.
Abstract: In this survey, we argue that the economic analysis of fertility has entered a new era. First-generation models of fertility choice were designed to account for two empirical regularities that, in the past, held both across countries and across families in a given country: a negative relationship between income and fertility, and another negative relationship between women's labor force participation and fertility. The economics of fertility has entered a new era because these stylized facts no longer universally hold. In high-income countries, the income-fertility relationship has flattened and in some cases reversed, and the cross-country relationship between women's labor force participation and fertility is now positive. We summarize these new facts and describe new models that are designed to address them. The common theme of these new theories is that they view factors that determine the compatibility of women's career and family goals as key drivers of fertility. We highlight four factors that facilitate combining a career with a family: family policy, cooperative fathers, favorable social norms, and flexible labor markets. We also review other recent developments in the literature, and we point out promising new directions for future research on the economics of fertility.
Keywords: Fertility, Family Economics, Women's Labor Supply
The paper: [ PDF ]
NBER Working Paper No. 29948: [PDF ]
Replication Files (June 2023): [ zip file ]
Non-technical summaries:
A new era in the economics of fertility (published on VoxEU)
The New Economics of Fertility (published in Finance and Development, IMF)
Webinar: FFHDI, University of Chicago
Media coverage: The Economist (1), The Economist (2), BBC Brasil, Bloomberg, Financial Times, The New York Times
Covid-19 und das Arbeitsmarktverhalten von Frauen und Männern
Perspektiven der Wirtschaftspolitik; 23(1): 10-19, March 2022.
Abstract: In Folge von Covid-19 sind bisher mehr Männer als Frauen gestorben. Aber wirtschaftlich sind Frauen von der Pandemie stärker betroffen als Männer. In ihrer Thünen-Vorlesung vor dem Verein für Socialpolitik im Herbst 2021 erläutert Michèle Tertilt die Auswirkungen der Corona-Pandemie auf das Arbeitsmarktverhalten von Frauen und Männern und die sich dadurch ergebenden langfristigen Konsequenzen. Tertilt berichtet zunächst von einer empirischen Studie, in der sie gemeinsam mit Koautoren untersucht hat, inwieweit sich das relative Arbeitsangebot von Frauen und Männern in der Pandemie in einer Reihe von Ländern verändert hat. Sie stellt außerdem Ergebnisse eines quantitativen Modells vor, das die mittel- und langfristigen Konsequenzen der Pandemie für die Geschlechtergerechtigkeit am Arbeitsmarkt und insbesondere für das Lohngefälle vorhersagen soll.
Keywords: Covid-19, Pandemie, Rezessionen, Erwerbstätigkeit, Arbeitsteilung, Familie, Gleichberechtigung, Schulschließungen, Kinderbetreuung, Lohngefälle
The paper: [ Covid-19 und das Arbeitsmarktverhalten von Frauen und Männern ]
Gendered Impacts of Covid-19 in Developing Countries
with Titan Alon, Matthias Doepke and Kristina Manysheva
AEA Papers and Proceedings, Vol. 112, 272-276, May 2022.
Also available as IZA DP No. 15013, January 2022.
Abstract: In many high-income economies, the recession caused by the Covid-19 pandemic has resulted in unprecedented declines in women's employment. We examine how the forces that underlie this observation play out in developing countries, with a specific focus on Nigeria, the most populous country in Africa. A force affecting high- and low-income countries alike are increased childcare needs during school closures; in Nigeria, mothers of school-age children experience the largest declines in employment during the pandemic, just as in high-income countries. A key difference is the role of the sectoral distribution of employment: whereas in high-income economies reduced employment in contact-intensive services had a large impact on women, this sector plays a minor role in low-income countries. Another difference is that women's employment rebounded much more quickly in low-income countries. We conjecture that large income losses without offsetting government transfers drive up labor supply in low-income countries during the recovery.
Keywords: Covid-19, Pandemics, Women's Labor Supply, Gender Equality
The paper (January 2022): [ PDF ]
What is the Aggregate Impact of Pandemic Education Disruptions in Low-Income Countries?
with Titan Alon, Matthias Doepke and Kristina Manysheva
Work in progress
Abstract: The Covid-19 pandemic has led to prolonged school closures in most countries around the world. In this paper, we aim to quantify the potential impact of pandemic learning losses in developing countries, with a specific focus on sub-Saharan Africa. We argue that there are both micro and macro channels that imply that the repercussions of pandemic education disruptions are more severe in poorer compared to richer economies. First, the evidence suggests that children in poor countries suffer larger learning losses. This obtains in part because of a lower availability and efficiency of alternative learning channels such as virtual instruction, and in part because of a higher impact on dropout rates, which are amplified by income losses during the pandemic. Second, a given learning loss has a larger medium-run impact on the economy, because recent school graduates make up a larger fraction of the total labor force in low-income economies, and because older cohorts have relatively little formal education. We quantify these channels using a model of macro-development that is matched to household-level and aggregate data from Nigeria.
Keywords: Covid-19, School Closures, Developing Countries, Macro-Development
The paper: [ Draft available soon ]
Status Externalities in Education and Low Birth Rates in Korea
with Seongeun Kim and Minchul Yum
The American Economic Review, Vol. 114 (6), 1576-1611, June 2024
Abstract: East Asians, especially South Koreans, appear to be preoccupied with their offspring’s education—most children spend time in expensive private institutes and in cram schools in the evenings and on weekends. At the same time, South Korea currently has the lowest total fertility rate in the world. Motivated by novel empirical evidence on spillovers in private education spending, we propose a theory with status externalities and endogenous fertility that connects these two facts. Using a quantitative heterogeneous-agent model calibrated to Korea, we find that fertility would be 28% higher in the absence of the status externality and that childlessness in the poorest quintile would fall from five to less than one percent. We then explore the effects of various government policies. A pro-natal transfer or an education tax can increase fertility and reduce education spending, with heterogeneous effects across the income distribution. The policy mix that maximizes the current generation’s welfare consists of an education tax of 22% and moderate pro-natal transfers. This would raise average fertility by about 11% and decrease education spending by 39%. Although this policy increases the welfare of the current generation, it may not do the same for future generations as it lowers their human capital.
Keywords: Fertility, Status, Externality, Education, Childlessness, Korea
The paper (June 2024): [Link]
October 2023 version: [ PDF ]
June 2021 version (CEPR Discussion Paper No. 16271): [ PDF ]
Slides: [ PDF ]
Replication Files: [ data ]
Media Coverage: The Economist
From Mancession to Shecession: Women's Employment in Regular and Pandemic Recessions
with Titan Alon, Sena Coskun, Matthias Doepke and David Koll
NBER Macroeconomics Annual 2021, Volume 36, May 2022.
Abstract: We examine the impact of the global recession triggered by the Covid-19 pandemic on women's versus men's employment. Whereas recent recessions in advanced economies usually had a disproportionate impact on men's employment, giving rise to the moniker "mancessions," we show that the pandemic recession of 2020 was a "shecession" in most countries with larger employment declines among women. We examine the causes behind this pattern using micro data from several national labor force surveys, and show that both the composition of women's employment across industries and occupations as well as increased childcare needs during closures of schools and daycare centers made important contributions. While many countries exhibit similar patterns, we also emphasize how policy choices such as furloughing policies and the extent of school closures shape the pandemic's impact on the labor market. Another notable finding is the central role of telecommuting: gender gaps in the employment impact of the pandemic arise almost entirely among workers who are unable to work from home. Nevertheless, among telecommuters a different kind of gender gap arises: women working from home during the pandemic spent more work time also doing childcare and experienced greater productivity reductions than men. We discuss what our findings imply for gender equality in a post-pandemic labor market that will likely continue to be characterized by pervasive telecommuting.
Keywords: Recessions, Pandemics, Labor Suppy, Gender Equality
The paper (July 2021): [ PDF ]
Replication Files: [ zip file ]
Podcast (DE): Rolle rückwärts? Gleichberechtigung in der Krise, NDR Info, 2021, Fidelity Podcast
Video: Unemployment and working hours of women and men during the pandemic
Media Coverage: The Economist, The New York Times, Santa Fe Public Radio, The 19th, Newsweek, Bloomberg, Welt, ntv, Süddeutsche Zeitung, Newsweek, Le Monde, IPR
Consumer Credit with Over-Optimistic Borrowers
with Florian Exler, Jim MacGee and Igor Livshits
Journal of the European Economic Association, accepted.
Older version available as CEPR DP No. 15570, December 2020.
Abstract: Do cognitive biases call for regulation to limit the use of credit? We incorporate over-optimistic and rational borrowers into an incomplete markets model with consumer bankruptcy. Over-optimists face worse income risk but incorrectly believe they are rational. Thus, both types behave identically. Lenders price loans forming beliefs—type scores—about borrower types. This gives rise to a tractable theory of type scoring. As lenders cannot screen types, borrowers are partially pooled. Over-optimists face cross-subsidized interest rates but make financial mistakes: borrowing too much and defaulting too little. In equilibrium, the welfare losses from mistakes are more than compensated by cross-subsidization. We calibrate the model to the U.S. and quantitatively evaluate policies to address these frictions: financial literacy education, reducing default cost, increasing borrowing costs, and debt limits. While some policies lower debt and filings, only reducing default costs and financial literacy education improve welfare. However, financial literacy education benefits only rationals at the expense of over-optimists. Score-dependent borrowing limits can reduce financial mistakes but lower welfare.
Keywords: Consumer Credit, Credit Card Debt, Endogenous Financial Contracts, Overoptimism, Bankruptcy, Financial Literacy, Financial Regulation, Type Scoring, Cross-Subsidization
The paper (July 2024): [ PDF ]
February 2022 version: [ PDF ]
December 2020 version (CEPR DP): [ PDF ]
Slides: [ PDF ]
This Time It's Different: The Role of Women's Employment in a Pandemic Recession
with Titan Alon, Matthias Doepke and Jane Olmstead-Rumsey
CEPR DP No. 15149, August 2020.
Abstract: In recent US recessions, employment losses have been much larger for men than for women. Yet, in the current recession caused by the Covid-19 pandemic, the opposite is true: unemployment is higher among women. In this paper, we analyze the causes and consequences of this phenomenon. We argue that women have experienced sharp employment losses both because their employment is concentrated in heavily affected sectors such as restaurants, and due to increased childcare needs caused by school and daycare closures, preventing many women from working. We analyze the repercussions of this trend using a quantitative macroeconomic model featuring heterogeneity in gender, marital status, childcare needs, and human capital. Our quantitative analysis suggests that a pandemic recession will i) feature a strong transmission from employment to aggregate demand due to diminished within-household insurance; ii) result in a widening of the gender wage gap throughout the recovery; and iii) contribute to a weakening of the gender norms that currently produce a lopsided distribution of the division of labor in home work and childcare.
Keywords: COVID-19, pandemics, recessions, business cycle, gender equality, school closures, childcare, gender wage gap
The paper (November 2020): [ PDF ]
Non-technical summaries:
Impact of the Covid-19 Crisis on Women’s Employment (published on Econofact)
The Shecession of 2020: Causes and Consequences (published on VoxEU) | German Version: Die „She-cession“ von 2020: Ursachen und Folgen (Ökonomenstimme)
This Time It's Different: The Role of Women's Employment in a Pandemic Recession (featured as research highlight by the European Economic Association)
Presentation Slides: [ PDF ]
Podcast (DE): Corona und Familienökonomik
Interview: The Differential Impacts of the Pandemic Recession on Women and Men's Employment and Roles
Video: The Impact of COVID-19 on Gender Equality
Media Coverage:
Die Wochenzeitung,
National Public Radio,
China Daily,
Christian Science Monitor,
Deseret News,
Market Watch,
The Daily Chronicle,
WBEZ,
Vox,
Vox Ukraine,
Yahoo Money,
Nada es Gratis,
Business Insider,
The Wall Street Journal (1),
The Wall Street Journal (2),
The Wall Street Journal (3),
Planet Money,
CAPRW,
Monthly Labor Review,
BYU Radio,
U.S. News & World Report,
CNBC,
ECB (Speech by Isabel Schnabel),
MarketWatch (1),
MarketWatch (2),
Bloomberg,
The New York Times,
Nederlands Dagblad,
Elle,
BBC (1),
BBC (2),
Marketplace,
Commercial Observer,
Business Insider,
WFAE,
WGN-TV,
The Atlantic
The Short-Run Macro Implications of School and Child-Care Closures
with Nicola Fuchs-Schündeln and Moritz Kuhn
IZA DP No. 13353, May 2020.
Abstract: The COVID19 crisis has hit labor markets. School and child-care closures have put families with children in challenging situations. We look at Germany and quantify the macroeconomic importance of working parents. We document that 26 percent of the German workforce have children aged 14 or younger and estimate that 11 percent of workers and 8 percent of all working hours are affected if schools and child-care centers remain closed. In most European countries, the share of affected working hours is even higher. Policies to restart the economy have to accommodate the concerns of these families.
Keywords: COVID-19, labor market, children, child-care, parents, workforce
The paper (June 2020): [ PDF ]
A non-technical summary: The short-run macro implications of school and childcare closures (published on VoxEU)
Optimal Age-based Policies for Pandemics: An Economic Analysis of Covid-19 and Beyond
with Luiz Brotherhood, Philipp Kircher and Cezar Santos
Discussion Paper Series – CRC TR 224: Discussion Paper No. 175, August 2020.
Abstract: This paper investigates the importance of the age composition for pandemic policy design. To do so, it introduces an economic framework with age heterogeneity, individual choice, and incomplete information, emphasizing the value of testing. Calibrating the model to the US Covid-19 pandemic reveals an 80% reduction in death toll due to voluntary actions and the lockdown implemented in the US. The optimal lockdown, however, is more stringent than what was implemented in the US. Moreover, the social planner follows an asymmetric approach by locking down the young relatively more than the old. We underscore the importance of testing, showing its impact on reduced deaths, lower economic costs and laxer lockdown. We use the framework to provide systematic insights into pandemics caused by different viruses (among others the Spanish flu), and underline the influence of economic conditions on optimal policies.
Keywords: Covid-19, testing, social distancing, age, age-specific policies
The paper: New Version December 2023: [ PDF ]
Previous version from April 2021: [ PDF ]
Previous version from May 2020 (CEPR Discussion Paper No. 14695): [ PDF ]
Replication Files: New Version April 2021: [ zip file ]
Previous version from May 2020 (CEPR Discussion Paper No. 14695 ): [ zip file ]
Non-technical summaries:
The importance of testing and age-specific policies during the COVID-19 pandemic (published on VoxEU, 2020)
How public policies can curb pandemics: It's important to take the age composition into account
(published on VoxEU, 2024)
Research Insights: How Can Public Policies Curb Pandemics? (Policy Brief published by the Inter-American-Development-Bank)
Presentation Slides (New Slides with new Results, February 2021): [ PDF ]
Consumer Debt and Default: A Macro Perspective
with Florian Exler
Oxford Research Encyclopedia of Economics and Finance, October 2020.
Abstract: In this survey, we review the quantitative macroeconomic literature analyzing consumer debt and default. We start by providing an overview of consumer bankruptcy law in the US and document the relevant institutional changes over time. We proceed with a comprehensive empirical section, describing key facts about consumer debt, defaults and delinquencies, as well as charge-off and interest rates for the United States. In addition to the evolution of these variables over time, we construct life-cycle profiles using data from the Survey of Consumer Finances and show that debt and defaults display a clear hump-shaped profile by age. Third, we show how credit card debt has evolved along the income distribution. Finally, we document a large amount of heterogeneity in credit card interest rates across consumers. In the second part of the survey, we describe what has by now become the workhorse model of consumer credit and default. We discuss a quantitative version of the model and use it to decompose the main reasons for default. We also use the model to illustrate how the details of default costs matter. The remainder of the survey then discusses the literature centered around two questions. First, what are the welfare implications of various bankruptcy laws? And second, what caused the rise in filings over time? We end with a discussion of open questions and fruitful avenues for future research.
Keywords: Consumer Debt, Default, Bankruptcy, Chapter 7, Bankruptcy Law, Delinquency, Credit Cards, Unsecured Debt, Charge-Offs, Interest Rates
The paper: [ LINK ]
Working Paper Version: [ PDF ]
The Impact of COVID-19 on Gender Equality
with Titan Alon, Matthias Doepke and Jane Olmstead-Rumsey
Covid Economics: Vetted and Real-Time Papers, Issue 4, 62-85, April 2020.
Abstract: The economic downturn caused by the current Covid-19 outbreak has substantial implications for gender equality, both during the downturn and the subsequent recovery. Compared to 'regular' recessions, which affect men’s employment more severely than women’s employment, the employment drop related to social distancing measures has a large impact on sectors with high female employment shares. In addition, closures of schools and daycare centers have massively increased child care needs, which has a particularly large impact on working mothers. The effects of the crisis on working mothers are likely to be persistent, due to high returns to experience in the labour market. Beyond the immediate crisis, there are opposing forces which may ultimately promote gender equality in the labour market. First, businesses are rapidly adopting flexible work arrangements, which are likely to persist. Second, there are also many fathers who now have to take primary responsibility for child care, which may erode social norms that currently lead to a lopsided distribution of the division of labour in house work and child care.
Keywords: COVID-19, Division of Labor, Business Cycle, Gender Equality
The paper: [ PDF ]
Working paper version: [ PDF ]
Podcasts:
Corona und Familienökonomik
Gender equality in 2023 with Titan Alon
A non-technical summary: The impact of the coronavirus pandemic on gender equality (published on VoxEU)
Media Coverage:
CNN,
New York Times,
Behavioural scientist,
BBC future,
Quartz,
Wharton School,
The Sydney Morning Herald,
The Daily Northwestern,
PBS: To the Contrary,
Der Standard,
Mannheimer Morgen ,
Süddeutsche Zeitung ,
Bayerischer Rundfunk ,
Spiegel online,
Rhein-Neckar-Zeitung,
Le Monde.
Does Female Empowerment Promote Economic Development?
with Matthias Doepke
Journal of Economic Growth, Vol.24(4), 309-343, December 2019.
Abstract: Empirical evidence suggests that money in the hands of mothers (as opposed to fathers) increases expenditures on children. Does this imply that targeting transfers to women promotes economic development? Not necessarily. We consider a non-cooperative model of the household where a gender wage gap leads to endogenous household specialization. As a result, women indeed spend more on children and invest more in human capital. Yet, depending on the nature of the production function, targeting transfers to women may be beneficial or harmful to growth. Transfers to women are more likely to be beneficial when human capital, rather than physical capital or land, is the most important factor of production.We provide empirical evidence supportive of our mechanism: In Mexican PROGRESA data, transfers to women lead to an increase in spending on children, but a decline in the savings rate.
Keywords: Development, Female empowerment, Gender equality, Growth, Marital bargaining, Theory of the household
The paper: [ PDF ]
Replication Files: [ zip file ]
A non-technical summary: Women’s empowerment and development: The family connection (published on VoxDev)
Presentation Slides: [ PDF ]
Videos:
Are women better for development?
Will money in the hands of women promote economic development?
An Equilibrium Model of the African HIV/AIDS Epidemic
with Jeremy Greenwood, Philipp Kircher and Cezar Santos
Econometrica, Vol. 87, No. 4, 1081–1113, July 2019.
Abstract: Twelve percent of the Malawian population is HIV infected. Eighteen percent of sexual encounters are casual. A condom is used a third of the time. To analyze the Malawian epidemic, a choice-theoretic general equilibrium search model is constructed. In the developed framework, people select between different sexual practices while knowing the inherent risk. The calibrated model is used to study several policy interventions, namely, ART, circumcision, better condoms, and the treatment of other STDs. The efficacy of public policy depends upon the induced behavioral changes and equilibrium effects. The framework complements the insights from epidemiological studies and small-scale field experiments.
Keywords: ART, circumcision, condoms, disease transmission, epidemiological studies, HIV/AIDS, knowledge about HIV, Malawi, marriage, policy intervention, search, small field experiments, STDs, sex markets
The paper: [ PDF ]
Older NBER working paper version: [PDF ]
Replication Files: [ zip file ]
Appendix: [ PDF ]
Non-technical summaries:
An equilibrium model of the African HIV/AIDS epidemic (published on VoxEU)
What caused the HIV/AIDS decline in Africa? Anti-retroviral therapy or better information? (published on VoxDev)
Presentation Slides: [ PDF ]
Video: Where do we stand in the fight against HIV?
Women's Empowerment, the Gender Gap in Desired Fertility, and Fertility Outcomes in Developing Countries
with Matthias Doepke
The American Economic Review, Papers and Proceedings, May 2018.
Abstract: We document evidence on preferences for childbearing in developing countries. Across countries, men usually desire larger families than women do. Within countries, we find wide dispersion in spouses' desired fertility: there are many couples whose ideal family size differs by five children or more. This disagreement between spouses suggests that the extent to which women are empowered should matter for fertility choices. We point to evidence at both the macro and micro levels that this is indeed the case. We conclude that taking account of household bargaining and women's empowerment in analyses of fertility is an important challenge for research.
Keywords: women's empowerment, desired fertility, marital bargaining
The paper: [ PDF ]
Replication Files: [ zip file ]
Presentation Slides: [ PDF ]
The Role of Marriage in Fighting HIV: A Quantitative Illustration for Malawi
with Jeremy Greenwood, Philipp Kircher and Cezar Santos
The American Economic Review, Papers and Proceedings, 2017.
Abstract: How might policies that promote marriage and/or dissuade divorce help in the fight against HIV/AIDS? This question is addressed employing a choice-theoretic general equilibrium search model, using Malawi as a case study. In the framework developed, individuals can choose between married and single life. A single person can select among abstinence and sex with or without a condom. The results suggest that marriage-friendly policies can help to abate HIV/AIDS. The policy predictions that obtain from general equilibrium analysis are compared with those that arise from simulated synthetic field experiments and epidemiological studies.
Keywords: AIDS, circumcision, condoms, general equilibrium modeling, HIV, marriage and divorce, Malawi, sex markets, search
The paper: [ PDF ]
Families in Macroeconomics
with Matthias Doepke
Chapter in Handbook of Macroeconomics, Volume 2, 1789-1891, edited by John B. Taylor and Harald Uhlig, Elsevier B.V., December 2016.
Abstract: Much of macroeconomics is concerned with the allocation of physical capital, human capital, and labor over time and across people. The decisions on savings, education, and labor supply that generate these variables are made within families. Yet the family (and decision making in families) is typically ignored in macroeconomic models. In this chapter, we argue that family economics should be an integral part of macroeconomics and that accounting for the family leads to new answers to classic macro questions.Our discussion is organized around three themes. We start by focusing on short- and medium-run fluctuations and argue that changes in family structure in recent decades have important repercussions for the determination of aggregate labor supply and savings. Next, we turn to economic growth and describe how accounting for families is central for understanding differences between rich and poor countries and for the determinants of long-run development. We conclude with an analysis of the role of the family as a driver of political and institutional change.
Keywords: Family economics, Macroeconomics, Business cycles, Growth, Households, Fertility, Labor supply, Human capital, Gender
The chapter: [ PDF ]
Replication Files: Codes and Data (zip), Cross-Country Data (xlsx) and Time Series Data (xslm)
The Democratization of Credit and the Rise in Consumer Bankruptcies
with Igor Livshits and James MacGee
Review of Economic Studies, Vol. 83 (4), 1673-1710, 2016.
Abstract: Financial innovations are a common explanation for the rise in credit card debt and bankruptcies. To evaluate this story, we develop a simple model that incorporates two key frictions: asymmetric information about borrowers’ risk of default and a fixed cost of developing each contract lenders offer. Innovations that ameliorate asymmetric information or reduce this fixed cost have large extensive margin effects via the entry of new lending contracts targeted at riskier borrowers. This results in more defaults and borrowing,and increased dispersion of interest rates. Using the Survey of Consumer Finances and Federal Reserve Board interest rate data, we find evidence supporting these predictions. Specifically, the dispersion of credit card interest rates nearly tripled while the “new” cardholders of the late 1980s and 1990s had riskier observable characteristics than existing cardholders. Our calculations suggest that these new cardholders accounted for over 20% of the rise in bank credit card debt and delinquencies between 1989 and 1998.
Keywords: Credit cards, Endogenous financial contracts, Bankruptcy, Financial innovation
The paper: [ PDF ]
Replication Files: [ zip file ]
Appendix: [ PDF ]
Presentation Slides: [ PDF ]
Video: The democratization of credit
Gender Gaps in Completed Fertility
with Erica Field, Vera Molitor and Alice Schoonbroodt
Journal of Demographic Economics, Vol. 82(02), 167-206, June 2016.
Abstract: The most common measure of reproductive behavior is the total fertility rate, which measures children born per woman. However, little work exists measuring male fertility behavior. We use survey data from several waves of the Demographic and Health Surveys (DHS) in eight Sub-Saharan African countries. We document several interesting differences in fertility outcomes of men and women. First, comparing completed fertility by birth cohorts, we find that on average men have more children than women in seven out of eight countries we consider. The gaps are large – reaching up to 4.6 children in Burkina Faso. Positive gaps are possible when populations are growing and men father children with younger women. Such a situation often coincides with polygyny. Indeed,we find that the fertility gap is positively related to the degree of polygyny.Second, we find a lower variance in completed fertility rates for women than for men, especially in high polygyny countries. Third, we find that differences in the desire to have children can largely be explained by differences in realized fertility. Finally, we find that for men, the demographic transition started earlier and was steeper than for women. These novel facts are useful when building theories of fertility behavior.
Keywords: fertility, gender, polygyny
The paper: [ PDF ]
Presentation Slides: [ PDF ]
The Association Between Own Unemployment and Female Victimization Among Female Youths
with Gerard van den Berg
Journal of Economics and Statistics, Special Issue, JBNST - Vol. 235/4+5, 499-513, 2015.
Abstract: We estimate the association between the unemployment status of young women and the probability that they are subject to violence, using Swedish population register data covering the period 1999-2008. These data contain the highest-level classification of diagnoses made by medical experts at every in-dividual in-patient and out-patient visit to medical care units, including everycontact with a physician. We distinguish between domestic and non-domestic violence. It turns out that unemployed women are significantly more likely to be victimized than employed women with the same individual characteristics. This is mostly reflected in indicators of non-domestic violence and long-run abuse among unemployed female youths.
Keywords: conflict, household, relationships, assaults, abuse, health, crime, ICD codes
The paper: [ PDF ]
Property Rights and Efficiency in OLG Models with Endogenous Fertility
with Alice Schoonbroodt
Journal of Economic Theory, Vol. 150, 551–582, March 2014.
Abstract:Is there an economic rationale for pronatalist policies? We propose and analyze a particular market failure that leads to inefficiently low fertility in equilibrium. The friction is caused by the lack of ownership of children: if parents have no claim on their children’s income, the private benefit from producing a child can be smaller than the social benefit. We analyze an overlapping-generations (OLG) model with fertility choice and parental altruism. Ownership is modeled as a minimum constraint on transfers from parents to children. Using the efficiency concepts proposed in Golosov, Jones, and Tertilt[38], we find that whenever the transfer floor is binding, fertility choices are inefficient. Second, we show that the usual conditions for efficiency are not sufficient in this context. Third, in contrast to settings with exogenous fertility, a PAYG social security system cannot be used to implement efficient allocations. To achieve an efficient outcome,government transfers need to be tied to fertility choice.
Keywords: Overlapping generations, Fertility, Efficiency
The paper: [ PDF ]
Supplementary Appendix: [ PDF ]
Technical Appendix: [ PDF ]
Presentation Slides: [ PDF ]
The Economics and Politics of Women's Rights
with Matthias Doepke and Alessandra Voena
Annual Review of Economics, Vol. 4, 339-372, July 2012.
Abstract: Women’s rights and economic development are highly correlated.Today, the discrepancy between the legal rights of women and men is much larger in developing compared with developed countries. Historically, even in countries that are now rich, women had few rights before economic development took off. Is development the cause of expanding women’s rights, or conversely, do women’s rights facilitate development? We argue that there is truth to both hypotheses. The literature on the economic consequences of women’s rights documents that more rights for women lead to more spend-ing on health and children, which should benefit development. The political-economy literature on the evolution of women’s rights finds that technological change increased the costs of patriarchy for men and thus contributed to the expansion of women’s rights. Combining these perspectives, we discuss the theory of Doepke and Tertilt(2009), who find that an increase in the return to human capital induces men to vote for women’s rights, which in turn promotes growth in human capital and income per capita.
Keywords: women’s liberation, female suffrage, fertility, human capital, development
The paper: [ PDF ]
Small Correction: [ PDF ]
Families as Roommates: Changes in U.S. Household Size
with Todd Schoellman and Alejandrina Salcedo
Quantitative Economics, Vol. 3, 122-175, March 2012.
Abstract: Living arrangements have changed enormously over the last two centuries. While the average American today lives in a household of only three people, in 1850household size was twice that figure. Furthermore, both the number of children and the number of adults in a household have fallen dramatically. We develop a simple theory of household size where living with others is beneficial solely because the costs of household public goods can be shared. In other words, we abstract from intra-family relations and focus on households as collections of roommates. The model’s mechanism is that rising income leads to a falling expenditure share on household public goods, which endogenously makes household formation less beneficial and privacy more attractive. To assess the magnitude of this mechanism, we first calibrate the model to match the relationship between household size, consumption patterns, and income in the cross section at the end of the 20th century. We then project the model back to 1850 by changing income.We find that our proposed mechanism can account for 37 percent of the decline in the number of adults in a household between 1850 and 2000, and for 16 percent of the decline in the number of children.
Keywords: Household size, living arrangements, roommates, economies of scale,household public goods, fertility decline
The paper: [ PDF ]
Presentation Slides: [ PDF ]
Accounting for the Rise in Consumer Bankruptcies
with Igor Livshits and Jim MacGee
American Economic Journal: Macro, Vol. 2, No. 2, 165-193, April 2010
Abstract: Personal bankruptcies in the United States have increased dramatically, rising from 1.4 per thousand working age adults in 1970 to 8.5 in 2002. We use a heterogeneous agent life-cycle model with competitive lenders to evaluate several commonly offered explanations. We find that increased uncertainty (income shocks, expense uncertainty) cannot account quantitatively for the rise in bankruptcies. Instead, the rise in filings appears mainly to reflect changes in the credit market environment: a decrease in the transaction cost of lending and in the cost of bankruptcy. We also argue that the abolition of usury laws and other legal changes were unimportant.
Keywords: consumer bankruptcy, uncertainty; credit markets, stigma
The paper: [ PDF ]
Replication Files: [ zip file ]
Appendix: [ PDF ]
Presentation Slides: [ PDF ]
Fertility Theories: Can they explain the Negative Fertility-Income Relationship?
with Larry E. Jones and Alice Schoonbroodt
Chapter in Demography and the Economy, 43-100, edited by John Shoven, University of Chicago Press, November 2010. (Also available as NBER Working Paper # 14266.)
Abstract: In this chapter we revisit the relationship between income and fertility. There is overwhelming empirical evidence that fertility is negatively related to income in most countries at most times. Several theories have been proposed in the literature to explain this somewhat puzzling fact. The most common one is based on the opportunity cost of time being higher for individuals with higher earnings. Alternatively, people might differ in their desire to procreate and accordingly some people invest more in children and less in market-specific human capital and thus have lower earnings. We revisit these and other possible explanations. We find that these theories are not as robust as is commonly believed. That is, several special assumptions are needed to generate the negative relationship. Not all assumptions are equally plausible. Such findings will be useful to distinguish alternative theories. We conclude that further research along these lines is needed.
The paper: [ PDF ]
Women's Liberation: What's in it for Men?
with Matthias Doepke
Quarterly Journal of Economics, Vol. 124, No. 4, 1541-1591, November 2009.
Abstract: The nineteenth century witnessed dramatic improvements in the legal rights of married women. Given that they took place long before women gained the right to vote, these changes amounted to a voluntary renouncement of power by men. In this paper, we investigate men’s incentives for sharing power with women. In our model, women’s legal rights set the marital bargaining power of husbands and wives. We show that men face a tradeoff between the rights they want for their own wives (namely none) and the rights of other women in the economy. Men prefer other men’s wives to have rights because men care about their own daughters and because an expansion of women’s rights increases educational investments in children. We show that men may agree to relinquish some of their power once technological change increases the importance of human capital. We corroborate our argument with historical evidence on the expansion of women’s rights in England and the United States.
Keywords: economic growth, human capital, political economy, return to education, women's rights
The paper: [ PDF ]
Appendix: [ PDF ]
A non-technical summary: Women’s rights: What’s in it for men? (published on VoxEU)
Presentation Slides: [ PDF ]
A Note on Marriage Market Clearing
with Urvi Neelakantan
Economic Letters, Vol 101, pp. 103-105, June 2008.
Abstract: We provide a formula for marriage sex ratios based on birth sex ratios and dynamic factors like the marriageage gap and gender-specific mortality. We show that ignoring dynamic considerations can lead to faultyconclusions about scarcity in marriage markets.
Keywords: marriage market, sex ratio, age gap, polygyny, mortality
The paper: [ PDF ]
An Economic History of Fertility in the U.S.: 1826-1960
with Larry E. Jones
Chapter in book Frontiers of Family Economics, Vol. 1 edited by Peter Rupert, Emerald Press, 2008. (Also available as NBER Working Paper No. 12796.)
Abstract: In this paper, we use data from the US census to document the history of the relationship between fertility choice and key economic indicators at the individual level for women born between 1826 and 1960. We find that this data suggests several new facts that should be useful for researchers trying to model fertility. (1) The reduction in fertility known as the Demographic Transition (or the Fertility Transition) seems to be much sharper based on cohort fertility measures compared to usual measures like Total Fertility Rate; (2) The baby boom was not quite as large as is suggested by some previous work; (3) We find a strong negative relationship between income and fertility for all cohorts and estimate an overall income elasticity of about -0.38 for the period; (4) We also find systematic deviations from a time invariant, isoelastic, relationship between income and fertility. The most interesting of these is an increase in the income elasticity of demand for children for the 1876-1880 to 1906-1910 birth cohorts. This implies an increased spread in fertility by income which was followed by a dramatic compression.
The paper: [ PDF ]
Efficiency with Endogenous Population Growth
with Mikhail Golosov and Larry E. Jones
Econometrica, Vol 75 (4), 1039-1071, July 2007.
Abstract: In this paper, we generalize the notion of Pareto efficiency to make it applicable to environments with endogenous populations. Two efficiency concepts are proposed: P-efficiency and A-efficiency. The two concepts differ in how they treat potential agents that are not born. We show that these concepts are closely related to the notion of Pareto efficiency when fertility is exogenous. We prove a version of the first welfare theorem for Barro–Becker type fertility choice models and discuss how this result can be generalized. Finally, we study examples of equilibrium settings in which fertility decisions are not efficient, and we classify them into settings where inefficiencies arise inside the family and settings where they arise across families.
Keywords: Pareto optimality, first welfare theorem, fertility, dynasty, altruism
The paper: [ PDF ]
Appendix: [ PDF ]
Presentation Slides: [ PDF ]
Consumer Bankruptcy - A Fresh Start
with Igor Livshits and Jim MacGee
The American Economic Review, Vol. 97 (1), 402-418, March 2007.
Abstract: Consumer bankruptcy provides partial insurance against bad luck, but, by driving up interest rates, makes life-cycle smoothing more difficult. We argue that to assess this trade-off one needs a quantitative model of consumer bankruptcy with three key features: life-cycle component, idiosyncratic earnings uncertainty, and expense uncertainty (exogenous negative shocks to household balance sheets). We find that transitory and persistent earnings shocks have very different implications for evaluating bankruptcy rules. More persistent shocks make the bankruptcy option more desirable. Larger transitory shocks have the opposite effect. Our findings suggest the current US bankruptcy system may be desirable for reasonable parameter values.
Keywords: consumer bankruptcy, fresh start, life cycle
The paper: [ PDF ]
An older working paper version that contains more details: [ PDF ]
Replication Files: [ LINK ]
Polygyny, Women's Rights, and Development
Journal of the European Economic Association, Vol. 4(2-3), 523-530, May 2006.
Abstract: Many Sub-Saharan African countries are extremely poor. It has been argued that the marriage system—in particular polygyny—is one contributing factor to the lack of development in this region. However, enforcing monogamy has proved to be very difficult. In this paper, I argue that transferring the right of choosing a husband from fathers to daughters might be an alternative policy that could potentially be easier to enforce. I use a calibrated general equilibrium model of polygyny to analyze such a policy. I find that giving daughters more choices has similar economic effects as a ban on polygyny. Both policies decrease the return on wives for men and thereby raise the incentive to invest in alternative assets. This increases the capital stock and hence GDP per capita. Quantitatively, however, I find that enforcing monogamy has much larger effects.
The paper: [ PDF ]
Marriage Laws and Growth in Sub-Saharan Africa
with Todd Schoellman
The American Economic Review, Papers and Proceedings, Vol. 96(2), 295-298, May 2006.
The paper: [ PDF ]
Polygyny, Fertility, and Savings
Journal of Political Economy, Vol.113 (6), 1341-1371, December 2005.
Abstract: Sub-Saharan Africa has a high incidence of polygyny. It is also the poorest region of the world. In this paper I ask whether banning polygyny could play any role for development. Using a quantitative model of polygyny, I find that enforcing monogamy lowers fertility, shrinks the spousal age gap, and reverses the direction of marriage payments. Polygyny leads to high bride-prices to “ration” women, which makes buying wives and selling daughters a good investment, thus crowding out investment in physical assets. For reasonable parameter values, I find that banning polygyny decreases fertility by 40 percent, increases savings by 70 percent, and increases output per capita by 170 percent.
The paper: [ PDF ]
Data: [ XLS ]
Presentation Slides: [ PDF ]
IPUMS - CPS , An Integrated Version of the March Current Population Survey, 1962-2002
with Miriam L. King
Historical Methods, Vol. 36, 35-40, Winter 2003.
Abstract: The Minnesota Population Center (MPC) is creating an integrated version of the March U.S. Current Population Survey (CPS) covering the years 1962-2002. The CPS is one of the few comprehensive data sources available for researching social and economic trends between decennial censuses. The survey also includes useful information - such as employment patterns and participation in social welfare programs - that is not available in the census. The new database will be compatible with the decennial census data available in the Integrated Public Use Microdata Series (IPUMS). For variables found in both sources, the integrated CPS will use IPUMS codes, and the documentation and data access system for the CPS data will be based on IPUMS principles and infrastructure.
Keywords: Current Population Survey (CPS), demography, economics, IPUMS, microdata survey
The paper: [ PDF ]