The aim of this paper is to investigate the role that the marital status of children has in shaping the living arrangements of their widowed mothers and themselves and to explain the increase in the proportion of elderly widows living alone, which grew by 23.2% in the USA between 1970 and 1990. We propose a model where living arrangements are determined as the outcome of a game between the mother and her child, and where the fundamentals of the model depend on children's marital status. We estimate the model using 1970 data. We calculate the accuracy of the estimation and we obtain an excellent fit. Using the same measure of accuracy, the estimated model predicts that changes in the incomes of both the widow and her offspring and changes in the children's marital status generate more than the 83% of the increase in the number of widows living alone.

Using novel microdata, we explore lifecycle consumption in Sub-Saharan Africa. We find that households' ability to smooth consumption over the lifecycle is large, particularly, in rural areas. Consumption in old age is sustained by shifting to self-farmed staple food, as opposed to traditional savings mechanisms or food gifts. This smoothing strategy indicates two important costs. The first cost is a loss of human capital as children seem to be diverted away from school and into producing self-farmed food. Second, a diet largely concentrated in staple food (e.g., maize in Malawi) in old age results in a loss of nutritional quality for households headed by the elderly.

This paper revisits the question of how brain drain affects the optimal education policy of a developing economy. Our framework of analysis highlights the complementarity between public spending on education and students' efforts to acquire human capital in response to career opportunities at home and abroad. Given this complementarity, we find that brain drain has conflicting effects on the optimal provision of public education. A positive response is called for when the international earning differential with destination countries is large, and when the emigration rate is relatively low. In contrast with the findings in the existing literature, our numerical experiments show that these required conditions are in fact present in a large number of developing countries; they are equivalent to those under which an increase in emigration induces a net brain gain. As a further contribution, we study the interaction between the optimal immigration policy of the host country and education policy of the source country in a game-theoretic framework.

Studies show that the gain from China's remarkable growth of the past 35 years has not been evenly shared, especially through the intergenerational transmission of income. To address this concern, we use data from China Health and Nutrition Survey and find the intergenerational income elasticity to be 0.466 in 2011, which suggests that sons’ incomes are affected by their fathers’ economic statuses to a large extent. A cross-country comparison indicates that the degree of generational income mobility in China is lower than that in many developed nations. Meanwhile, by investigating possible transmission channels, we find that the fathers’ investments in the sons’ education and occupation play substantial roles in intergenerational transmission of income. The results not only demonstrate the trends in intergenerational income mobility in China, but also identify the most likely transmission channels, which is of great importance to improving social equality.

We link causally the riskiness of men's management of their finances with the probability of their experiencing a divorce. Our point of departure is that when comparing single men to married men, the former manage their finances in a more aggressive (that is, riskier) manner. Assuming that single men believe that low relative wealth has a negative effect on their standing in the marriage market and that they care about their standing in that market more than married men do, we find that a stronger distaste for low relative wealth translates into reduced relative risk aversion and, consequently, into riskier financial behavior. With this relationship in place we show how this difference varies depending on the “background” likelihood of divorce and, hence, on the likelihood of re-entry into the marriage market: married men in environments that are more prone to divorce exhibit risk-taking behavior that is more similar to that of single men than married men in environments that are little prone to divorce. We offer a theoretical contribution that helps inform and interpret empirical observations and regularities and can serve as a guide for follow-up empirical work, having established and identified the direction of causality.

The paper tests the idea that major demographic shifts can affect housing prices. We first build an overlapping generation model and analytically solve for the equilibrium price of the asset. The model predicts that economies with a higher fraction of old people in the overall population have lower house prices. We empirically test this hypothesis using data on house prices and demographic variables from the Organization for Economic Co-operation and Development (OECD). We find that if population growth increases by one percentage point, house price growth increases by 1.4 percentage points.

Economists theorize that the inverse relationship between income and family size reflects a trade-off between child quality and quantity. Testing this hypothesis requires addressing the simultaneity of the quality and quantity decisions. The unanticipated birth of twins and sex composition of the first two children have been used as the exogenous variation in family size with mixed results. We exploit the One-Child Policy (OCP) in China, which exogenously reduced fertility, and examine how the OCP affected the education of Chinese migrants to the USA. Using the American Community Survey and a difference-in-differences strategy, we find higher levels of education for Chinese migrants born after the OCP compared with their counterparts from other East Asian countries. This finding provides additional support for the existence of a quality-quantity trade-off.

US women, on average, had approximately two children in both the 1930s and in the 1970s, yet the fertility distribution in the 1930s was less concentrated. This implies change in reproductive behavior, which cannot be captured by models focusing on average fertility. To explain these changes, I have developed a model that makes a distinction between sons and daughters. In this model, the female labor force participation rate is the probability of each girl becoming an employed woman. This endogenizes the empirically observed difference in the propensity for an all-girl household to have another child compared to an all-boy household, generating large fertility differentials at low participation rates. Higher participation rates raise the expected return from an additional child, as well as the expected return from existing daughters. The first effect tends to increase fertility, while the second effect, for relatively concave utility functions, tends to decrease it, so that the distribution of completed fertilities becomes more concentrated.

This paper reexamines the Serendipity Theorem of Samuelson (1975) from the stability viewpoint, and shows that, for the Cobb–Douglas preference and CES technology, the most-golden golden-rule lifetime state being stable depends on parameter values. In some situations, the Serendipity Theorem fails to hold despite the fact that steady-state welfare is maximized at the population growth rate, since the steady state is unstable. Through numerical simulations, a more general case of CES preference and CES technology is also examined, and we discuss the realistic relevance of our results. We present the policy implication of our result, that is, in some cases, the steady state with the highest utility is unstable, and thus a policy that aims to achieve the social optima by manipulating the population growth rate may lead to worse outcomes.

Inclusion of additional dimensions to population projections can lead to an improvement in the overall quality of the projections and to an enhanced analytical potential of derived projections such as literacy skills and labor force participation. This paper describes the modeling of educational attainment of a microsimulation projection model of the European Union countries. Using ordered logistic regressions on five waves of the European Social Survey, we estimate the impact of mother's education and other sociocultural characteristics on educational attainment and implement them into the microsimulation model. Results of the different projection scenarios are contrasted to understand how the education of the mother and sociocultural variables may affect projection outcomes. We show that a change in the impact of mother's education on children's educational attainment may have a big effect on future trends. Moreover, the proposed approach yields more consistent population projection outputs for specific subpopulations.

Developing countries often lack an adequate social security system, and elderly parents rely heavily on their children for support. Aging populations and low-fertility rates are an emerging trend in developing countries. In this paper, we examine the effects of sibship size on individuals' internal migration decisions in China. We find that the number of siblings has a positive effect on individual migration decisions, but this effect is non-linear and marginally increasing. Second, we find that having brothers has a more significant effect on migration decisions than having sisters. Finally, although of different magnitudes, the effects are persistent across genders, Hukou status, and education levels.

We study how the work effort and output of non-migrants in a village economy are affected when a member of the village population migrates. Given that individuals dislike low relative income, and that migration modifies the social space of the non-migrants, we show why and how the non-migrants adjust their work effort and output in response to the migration-generated change in their social space. When migration is negatively selective such that the least productive individual departs, the output of the non-migrants increases. While as a consequence of this migration statically calculated average productivity rises, we identify a dynamic repercussion that compounds the static one.

We examine the birth order effects on health status for a sample of children aged 1–18 years in South Africa. Using a mother fixed-effects specification, we observe children's height-for-age z-score decreases with birth order. We investigate potential mechanisms underlying the birth order effect including those related to biology, parental preferences, and resource dilution. We also look at whether these effects are due to selection into families of different sizes. We find that the magnitude of the effect is larger in poorer and rural households and in larger families – suggesting that the birth order effect is largely due to resource dilution in economically constrained households.