Showing papers in "Journal of Human Resources in 2011"
TL;DR: This paper found evidence of significant racial disparities in a new type of credit market known as peer-to-peer lending and showed that despite the higher average interest rates charged to blacks, lenders making such loans earn a lower net return compared to loans made to whites with similar credit profiles because blacks have higher relative default rates.
Abstract: :We find evidence of significant racial disparities in a new type of credit market known as peer-to-peer lending. Loan listings with blacks in the attached picture are 25 to 35 percent less likely to receive funding than those of whites with similar credit profiles. Despite the higher average interest rates charged to blacks, lenders making such loans earn a lower net return compared to loans made to whites with similar credit profiles because blacks have higher relative default rates. These results provide insight into whether the discrimination we find is taste-based or statistical.
395 citations
TL;DR: This paper examined the PROMISE program in West Virginia, which offers free tuition to students who maintain a minimum GPA and course load, and found robust and significant impacts on key academic outcomes.
Abstract: :Programs linking college aid to academic achievement could work either by lowering the cost of college or by inducing additional student effort. I examine the PROMISE program in West Virginia, which offers free tuition to students who maintain a minimum GPA and course load. Using administrative data, I exploit discontinuities in the eligibility formula and the timing of implementation to estimate causal effects. I find robust and significant impacts on key academic outcomes. Impacts are concentrated around the annual requirements for scholarship renewal, suggesting that the program works via incentives for academic achievement, not simply by relaxing financial constraints.
313 citations
TL;DR: A Dutch compulsory schooling law is exploited to estimate the causal effect of education on mortality, finding that the reform provides a powerful instrument, significantly raising years of schooling, which has a significant and robust negative effect on mortality.
Abstract: While there is no doubt that health is strongly correlated with education, whether schooling exerts a causal impact on health is not firmly established. We exploit a Dutch compulsory schooling law to estimate the causal effect of education on mortality. The reform provides a powerful instrument, significantly raising years of schooling, which, in turn, has a significant and robust negative effect on mortality. For men surviving to age 81, an extra year of schooling is estimated to reduce the probability of dying before the age of 89 by almost three percentage points relative to a baseline of 50 percent.
192 citations
TL;DR: In this paper, the authors combine data from classroom observations of teaching practices and measures of teachers' ability to improve student achievement as one contribution to these questions, finding that observation measures of teaching effectiveness are substantively related to student achievement growth and that some observed teaching practices predict achievement more than other practices.
Abstract: :Research continues to find large differences in student achievement gains across teachers' classrooms. The variability in teacher effectiveness raises the stakes on identifying effective teachers and teaching practices. This paper combines data from classroom observations of teaching practices and measures of teachers' ability to improve student achievement as one contribution to these questions. We find that observation measures of teaching effectiveness are substantively related to student achievement growth and that some observed teaching practices predict achievement more than other practices. Our results provide information for both individual teacher development efforts, and the design of teacher evaluation systems.
174 citations
TL;DR: Results point to multiple channels linking fetal health shocks to childhood outcomes: physical development is impeded, but only when mothers had certain health characteristics; by contrast, the negative effects on cognitive development appear general across the cohort.
Abstract: This paper examines the impact of in utero exposure to the Asian inuenza pandemic of 1957 upon physical and cognitive development in childhood. Outcome data is provided by the National Child Development Study (NCDS), a panel study of a cohort of British children who were all potentially exposed in the womb. Epidemic eects are identied using geographic variation in a surrogate measure of
149 citations
TL;DR: In this article, the authors estimate that ozone causes at least $44 million in annual costs in Los Angeles from respiratory related hospitalizations alone and that the cost of avoidance behavior is at least$11 million per year.
Abstract: :A pervasive problem in estimating the costs of pollution is that optimizing individuals may compensate for increases in pollution by reducing their exposure, resulting in estimates that understate the full welfare costs. To account for this issue, measurement error, and environmental confounding, we estimate the health effects of ozone using daily boat traffic at the port of Los Angeles as an instrumental variable for ozone. We estimate that ozone causes at least $44 million in annual costs in Los Angeles from respiratory related hospitalizations alone and that the cost of avoidance behavior is at least $11 million per year.
147 citations
TL;DR: Based on the prevalent son preference in China, a new measure of relative bargaining power within the household is proposed and it is shown that a woman with a first-born son has a 3.9 percentage points' greater role in household decision-making than a Women's Health and Nutrition Survey.
Abstract: :Based on the prevalent son preference in China, this paper proposes a new measure of relative bargaining power within the household. Using data from China Health and Nutrition Survey, we show that a woman with a first-born son has a 3.9 percentage points' greater role in household decision-making than a woman with a first-born daughter. Having a first-born son improves the mother's nutrition intakes and reduces her likelihood of being underweight. While thinking of these impacts as being channeled through intrahousehold bargaining power, we cannot fully rule out other possible direct effects of a first-born son on the outcomes.
134 citations
TL;DR: It is found that hospitalization for an assault while pregnant reduces birth weight by 163 grams, which sheds new light on the infant health production process as well as observed income gradients in health given that poor mothers are disproportionately affected by violence.
Abstract: :Two percent of women in the United States suffer from intimate partner violence annually, with poor and minority women disproportionately affected. I provide evidence of an important negative externality associated with domestic violence by estimating a negative and causal relationship between violence during pregnancy and newborn health, exploiting variation in the enforcement of laws against domestic violence for identification. I find that hospitalization for an assault while pregnant reduces birth weight by 163 grams. This sheds new light on the infant health production process as well as observed income gradients in health given that poor mothers are disproportionately affected by violence.
124 citations
TL;DR: In this paper, the authors evaluate longer run impacts on schooling and work of the best-known conditional cash transfer (CCT) program, Mexico's PROGRESA/Oportunidades, using experimental and nonexperimental estimators based on groups with different program exposure.
Abstract: Conditional cash transfer (CCT) programs link public transfers to human capital investment in hopes of alleviating current poverty and reducing its intergenerational transmission. However, little is known about their long-term impacts. This paper evaluates longer-run impacts on schooling and work of the best-known CCT program, Mexico's PROGRESA/Oportunidades, using experimental and nonexperimental estimators based on groups with different program exposure. The results show positive impacts on schooling, reductions in work for younger youth (consistent with postponing labor force entry), increases in work for older girls, and shifts from agricultural to nonagricultural employment. The evidence suggests schooling effects are robust with time.
119 citations
TL;DR: It is found that older women acquire financial literacy as they approach widowhood—80 percent would catch up with their husbands by the expected onset of widowhood.
Abstract: Women tend to be less financially literate than men, consistent with a division of labor where husbands manage finances. However, women tend to outlive their husbands. I find that older women acquire financial literacy as they approach widowhood - 80 percent would catch up with their husbands by the expected onset of widowhood. These gains are not attributable to husbands' cognitive decline, as captured by cognition tests. The results are consistent with a model in which the division of labor collapses when a spouse dies: women have incentives to delay acquiring financial human capital, but also to begin learning before widowhood.
119 citations
Abstract: :We employ Chinese population census data to consider married, urban women's labor force participation decisions in the context of their families. We find that the presence in the household of a parent, parent-in-law, or person aged 75 or older increases prime-age women's likelihood of participating in market work. The presence of preschool-aged children decreases it. The negative effect on women's labor force participation of having young children in the household is substantially larger for married, rural-to-urban migrants than for their nonmigrant counterparts. Similarly, the positive effect of coresidence with elders is larger for rural-to-urban migrant women than for nonmigrants.
TL;DR: In this paper, the authors document trends in the volatility in earnings and household incomes between 1985 and 2005 in three different data sources: administrative earnings records, the Survey of Income and Program Participation (SIPP) matched to administrative earnings, and SIPP survey data.
Abstract: :We document trends in the volatility in earnings and household incomes between 1985 and 2005 in three different data sources: administrative earnings records, the Survey of Income and Program Participation (SIPP) matched to administrative earnings records, and SIPP survey data. In all data sources, we find a substantial amount of year-to-year volatility in workers' earnings and household incomes. In the data sources that contain administrative earnings, we find that volatility has been roughly constant, and has even declined slightly, since the mid-1980s. These findings differ from what is found using survey data and what has been reported in previous studies.
TL;DR: This paper investigated the causal relationship between children and female labor force participation and found that the presence of children affects neither the likelihood of work nor its intensity, but impacts the type of work a woman pursues.
Abstract: :We introduce a new instrument for family size, infertility, to investigate the causal relationship between children and female labor force participation. Infertility mimics an experiment where nature assigns an upper bound for family size, independent of a woman's background. This new instrument allows us to investigate the differential labor supply without restrictions on initial family size. Using the Demographic and Health Surveys from 26 developing countries we show that OLS estimates are biased upward. We find that the presence of children affects neither the likelihood of work nor its intensity, but impacts the type of work a woman pursues.
TL;DR: For example, the authors found that noncognitive skills (for example, confidence and assertiveness) and preferences regarding family, career, and jobs account for 82 percent of the gender earnings gap.
Abstract: :Focused on human capital, economists typically explain about half of the gender earnings gap. For a national sample of MBAs, we account for 82 percent of the gap by incorporating noncognitive skills (for example, confidence and assertiveness) and preferences regarding family, career, and jobs. Those two sources of gender heterogeneity account for a quarter of the "explained" pay gap, with half due to human capital variables and the other quarter due to hours worked and current job characteristics. Female MBAs appear to pay a penalty for "good citizen" behavior (choosing jobs that contribute to society) and characteristics (higher ethical standards).
TL;DR: The authors examined the extent to which self-reported health and psychosocial health are affected by relative economic status in China, for the first time examining the importance of reference groups not defined by geographic location or demographic characteristics.
Abstract: :We examine the extent to which self-reported health and psychosocial health are affected by relative economic status in China, for the first time examining the importance of reference groups not defined by geographic location or demographic characteristics. We propose a methodology to address potential bias from subjective reporting biases and control for unobserved community characteristics. Analyzing a nationally representative data set from China, our findings support the relative deprivation hypothesis and suggest that relatives and classmates are salient reference groups for urban residents and neighbors are important for rural residents.
TL;DR: The authors examined whether women's rising labor force participation led to increased intergenerational transmission of occupation from fathers to daughters, and developed a model where fathers invest in human capital that is specific to their own occupations.
Abstract: :We examine whether women's rising labor force participation led to increased intergenerational transmission of occupation from fathers to daughters. We develop a model where fathers invest in human capital that is specific to their own occupations. Our model generates an empirical test where we compare the trends in the probabilities that women work in their father's versus their father-in-law's occupation. Using data from birth cohorts born between 1909 and 1977, our results indicate that the estimated difference in these trends accounts for at least 13-20 percent of the total increase in the probability that a woman enters her father's occupation.
TL;DR: Tests of the two assumptions under which anchoring vignettes identify heterogeneity in reporting of categorical evaluations reject vignette equivalence and response consistency, and are rejected for reporting of cognitive and physical functioning in a sample of older English individuals.
Abstract: We propose tests of the two assumptions under which anchoring vignettes identify heterogeneity in reporting of categorical evaluations. Systematic variation in the perceived difference between any two vignette states is sufficient to reject vignette equivalence. Response consistency - the respondent uses the same response scale to evaluate the vignette and herself - is testable given sufficiently comprehensive objective indicators that independently identify response scales. Both assumptions are rejected for reporting of cognitive and physical functioning in a sample of older English individuals, although a weaker test resting on less stringent assumptions does not reject response consistency for cognition.
TL;DR: In this paper, the authors exploit detailed information on pensions and lifetime earnings for older workers in the 1992 wave of the Health and Retirement Study and employ an instrumental-variable identification strategy to estimate crowd-out.
Abstract: :Economists have long suggested that higher private pension benefits "crowd out" other sources of household wealth accumulation. We exploit detailed information on pensions and lifetime earnings for older workers in the 1992 wave of the Health and Retirement Study and employ an instrumental-variable (IV) identification strategy to estimate crowd-out. The IV estimates suggest statistically significant crowd-out: each dollar of pension wealth is associated with a 53-67 cent decline in nonpension wealth. With less precision, we use an instrumental-variable quantile regression estimator and find that most of the effect is concentrated in the upper quantiles of the wealth distribution.
TL;DR: The authors examined the effect of full-day compared to half-day attendance on childhood obesity and found that full day Head Start attendance significantly reduced the proportion of obese children at the end of the academic year.
Abstract: Coinciding with the work requirements of welfare reform in the mid-1990s, the early childhood education program, Head Start, significantly expanded to increase the availability of full-day classes Using unique administrative data, we examine the effect of full-day compared to half-day attendance on childhood obesity This effect is identified from changes in obesity over time and from the elimination of a state-provided full-day expansion grant that decreased the supply of full-day classes Our results suggest that full-day Head Start attendance significantly reduces the proportion of obese children at the end of the academic year
TL;DR: This article found that there has been essentially no gender difference in the college wage premium for at least a decade and a similar pattern appeared in quantile wage regressions and for advanced degree wage premiums.
Abstract: :A growing literature seeks to explain why so many more women than men now attend college. A commonly cited stylized fact is that the college wage premium is, and has been, higher for women than for men. After identifying and correcting a bias in estimates of college wage premiums, I find that there has been essentially no gender difference in the college wage premium for at least a decade. A similar pattern appears in quantile wage regressions and for advanced degree wage premiums.
TL;DR: In this article, the authors present evidence on intergenerational occupational mobility from agriculture to the non-farm sector using survey data from Nepal and Vietnam, and show that intergeneration occupational mobility is lower among women in both countries, and is lower in Nepal compared with Vietnam.
Abstract: :This paper presents evidence on intergenerational occupational mobility from agriculture to the nonfarm sector using survey data from Nepal and Vietnam. In the absence of credible instruments, the degree of selection on observables is used as a guide to the degree of selection on unobservables, a la Altonji et al. (2005) to address the unobserved genetic correlations. The results show that intergenerational occupational mobility is lower among women in both countries, and is lower in Nepal compared with Vietnam. In the case of Nepal, strong evidence favors a causal role played by the mother's nonfarm participation in the daughter's occupation choice, possibly because of cultural inheritance in a traditional society.
TL;DR: In this paper, the effect of relative income on marriage was investigated, and it was shown that a 10 percent higher reference group income is associated with a 2 percent reduction in marriage.
Abstract: :This paper investigates the effect of relative income on marriage. Accounting flexibly for absolute income, the ratio between a man's income and a local reference group median is a strong predictor of marital status, but only for low-income men. Relative income affects marriage even among those living with a partner. A 10 percent higher reference group income is associated with a 2 percent reduction in marriage. We propose an identity model to explain the results.
TL;DR: This article examined how racial matches between managers and their employees affect rates of employee quits, dismissals, and promotions in a large U.S. retail firm and found a general pattern of own-race bias across all outcomes in that employees usually have better outcomes when they are the same race as their manager.
Abstract: Using data from a large U.S. retail firm, we examine how racial matches between managers and their employees affect rates of employee quits, dismissals and promotions. We exploit changes in management at hundreds of stores to estimate hazard models with store fixed effects that control for all unobserved differences across store locations. We find a general pattern of own-race bias across all outcomes in that employees usually have better outcomes when they are the same race as their manager. But we do find anomalies in this pattern, particularly when the manager-employee match violates traditional racial hierarchies (e.g. nonwhites managing whites).
TL;DR: For instance, this paper found that black speakers whose voices were distinctly identified as black by anonymous listeners earn about 12 percent less than white speakers with similar observable skills, even after controlling for measures of skill and family background.
Abstract: Speech patterns differ substantially between whites and many African Americans. I collect and analyze speech data to understand the role that speech may play in explaining racial wage differences. Among blacks, speech patterns are highly correlated with measures of skill such as schooling and AFQT scores. They are also highly correlated with the wages of young workers. Even after controlling for measures of skill and family background, black speakers whose voices were distinctly identified as black by anonymous listeners earn about 12 percent less than whites with similar observable skills. Indistinctly identified blacks earn essentially the same as comparable whites. I discuss a number of models that may be consistent with these results and describe the data that one would need to distinguish among them.
TL;DR: The authors measured the extent of language assimilation among children of Hispanic immigrants by using test language randomization (English or Spanish) of Woodcock Johnson achievement tests in the New Immigrant Survey and attributed test score differences solely to test language.
Abstract: :We measure the extent of language assimilation among children of Hispanic immigrants. Our identification strategy exploits test language randomization (English or Spanish) of Woodcock Johnson achievement tests in the New Immigrant Survey and lets us attribute test score differences solely to test language. Students scoring poorly may be tracked into nonhonors classes and less competitive postsecondary schools, with subsequent long-term implications. Foreign-born children score higher on tests in Spanish; U. S.-born children score higher in English. However, foreign-born children arriving at an early age or with several years in the United States do not benefit from testing in Spanish.
TL;DR: In this paper, the authors used administrative data from the lottery-based open enrollment system in Beijing middle schools to obtain unbiased estimates of school fixed effects on student performance, and found that these fixed effects are highly correlated with teacher qualifications measured in particular by their official ranks.
Abstract: :We use administrative data from the lottery-based open enrollment system in Beijing middle schools to obtain unbiased estimates of school fixed effects on student performance. To do this, we classify children in selection channels, with each channel representing a unique succession of lotteries through which a child was assigned to a school. Results show that school fixed effects are strong determinants of student performance. These fixed effects are shown to be highly correlated with teacher qualifications measured in particular by their official ranks. Teacher qualifications have about the same predictive power for student test scores as do school fixed effects.
TL;DR: In this article, the effects of trade liberalization on child work in Indonesia were examined using a balanced panel of 261 districts, based on four rounds (1993 to 2002) of the Indonesian annual national household survey (Susenas), and relate workforce participation of children aged 10-15 to geographic variation in relative tariff exposure.
Abstract: We examine the effects of trade liberalization on child work in Indonesia. Our estimation strategy identifies geographical differences in the effects of trade policy through district level exposure to reduction in import tariff barriers. We use a balanced panel of 261 districts,
based on four rounds (1993 to 2002) of the Indonesian annual national household survey (Susenas), and relate workforce participation of children aged 10-15 to geographic variation in relative tariff exposure. Our main findings show that increased exposure to trade liberalization is associated with a decrease in child work among the 10 to 15 year olds. The effects of tariff reductions are strongest for children from low skill backgrounds and in rural areas. Favorable income effects for the poor, induced by trade liberalization, are likely to be the dominating effects underlying these results.
TL;DR: In this paper, the authors used data drawn from the National Longitudinal Study of Adolescent Health (NLSH) to estimate the relationship between migraine headache and three outcomes: high school grade point average, the probability of graduating high school, and probability of attending college.
Abstract: :Despite the fact that migraine headaches are common and debilitating, little is known about their effect on educational attainment. Using data drawn from the National Longitudinal Study of Adolescent Health, we estimate the relationship between migraine headache and three outcomes: high school grade point average, the probability of graduating high school, and the probability of attending college. Our results provide evidence that migraine headache negatively impacts human capital accumulation. The relationship between migraine headache and educational attainment is explained, in part, through its effect on school absences and the respondent's self-reported ability to pay attention in class and complete homework.
TL;DR: This paper found that occupation-gender cells that had larger increases in on-the-job IT use also experienced a larger increase in the home-based employment share and larger declines in the penalty.
Abstract: :This study documents the rapid growth in home-based wage and salary employment and the sharp decline in the home-based wage penalty in the United States between 1980 and 2000. These twin patterns, observed for both men and women in most occupation groups, suggest that employer costs of providing home-based work arrangements have decreased. Consistent with information technology (IT) advances being an important source of these falling costs, I find that occupation-gender cells that had larger increases in on-the-job IT use also experienced larger increases in the home-based employment share and larger declines in the home-based wage penalty.
TL;DR: For example, the authors found that positive income shocks of $25,000 to $50,000 do not cause statistically significant or economically meaningful changes in divorce rates, single women are less likely to marry as a result of the additional income.
Abstract: :Economists have long been interested in the extent to which economic resources affect decisions to marry and divorce. However, this issue has been difficult to address empirically due to a lack of exogenous income shocks. We overcome this problem by exploiting the randomness of the Florida Lottery and comparing recipients of large prizes to those of small prizes. Results indicate that while positive income shocks of $25,000 to $50,000 do not cause statistically significant or economically meaningful changes in divorce rates, single women are less likely to marry as a result of the additional income.