Economic incentives for financial and residential independence

In this paper we examine the impact of the resources of children and of their parents on the children’s transition to residential and financial independence. Previous studies of this transition focused primarily on the impact of family structure and parent-child relationships on the decision to leave home, but much less is known about the role of economic factors in the transition to independence. Using data from the Panel Study of Income Dynamics (PSID) for the period 1968–1988, we estimate discrete-hazard models of the probability of achieving residential and financial independence. We find that the child’s wage opportunities and the parents’ income are important determinants of establishing independence. The effect of parental income changes with the child’s age. We also find some evidence that federal tax policy influences the decision to become independent, although the magnitude of this effect is quite small.     

State regulations and child care choice

While government regulations are designed to safeguard the health and well-being of children, they may also alter the cost and availability of child care, thus affecting parental use of such services. This paper investigates the total effects of regulation on parental choice of child care and the indirect effects of regulation through the price, quality, and availability of care. In our analysis of data from the National Child Care Survey 1990 we find strong evidence that state regulations requiring center-based providers to be trained are associated with a lower probability that parents choose a center, while state inspections are associated with more parental choice of center and home care. We end by discussing the policy implications of our findings.     

The Effect of a First Born Child on Work and Childcare Time Allocation: Pre-post Analysis of Australian Couples

This paper uses Australian data from a national representative sample of Australian couples having their first child. Using data from before and after the birth of the child on a range of variables, including economic resources, gender attitudes, workplace flexibility, and availability of non-parental childcare, we first model the factors are associated with the decision to remain in work or not after the birth of the first child. The main finding here is that childbirth has a major impact on mothers’ paid work-time, whereas for fathers it has very little impact. Factors that are related to a mother’s decision to remain in work or not include the absolute (but not relative) pay of each parent, the father’s workplace flexibility, and paid parental leave available to the mother. We then model the factors that govern, for those mothers remaining in paid work, how much paid work they undertake. We find that changing employers is related to mothers’ work hours, as are absolute post-birth salaries, as is the relative pay of each partner. As with the decision to work or not, the availability of paid parental leave to the mother is significantly related to the amount of work-time for those mothers that do continue to work. Similarly, the use of external childcare is positively associated with maternal work hours. Finally, we model the factors that determine childcare time allocation and find that for neither parent do pre-birth economic resources significantly affect childcare time, once a decision about basic work patterns has been made. Gender role attitudes affect childcare time decisions, unlike work time decisions.     

A portrait of the nest-leaving process in early adulthood

This paper provides an in-depth portrait of the nest-leaving process in early adulthood as it emerged in the 1980s. Event histories are used to describe transitions in and out of the parental home during the years from age 15 through age 23. We focus on the role of the “new” forms of living arrangements in the leaving-home process, namely nonfamily living and cohabitation. The results show that the transition to full residential independence is more gradual, with more intermediate steps, than previous studies suggested. Cohabitation is rare as a route out of the parental home, and both nonfamily living and cohabitation lead to much higher return rates than does marriage.     

Parenthood and Leaving Home in Young Adulthood

With increases in nonmarital fertility, the sequencing of transitions in early adulthood has become even more complex. Once the primary transition out of the parental home, marriage was first replaced by nonfamily living and cohabitation; more recently, many young adults have become parents before entering a coresidential union. Studies of leaving home, however, have not examined the role of early parenthood. Using the Young Adult Study of the 1979 National Longitudinal Survey of Youth (n = 4,674), we use logistic regression to analyze parenthood both as a correlate of leaving home and as a route from the home. We find that even in mid-adolescence, becoming a parent is linked with leaving home. Coming from a more affluent family is linked with leaving home via routes that do not involve children rather than those that do, and having a warm relationship with either a mother or a father retards leaving home, particularly to nonfamily living, but is not related to parental routes out of the home.     

Children's Economic Roles in the Maya Family Life Cycle: Cain,Caldwell, and Chayanov Revisited

This article examines the relationship between household demographic pressure and interage transfers for a group of Maya subsistence agriculturists in Yucatán, Mexico. The authors use data from a field study conducted in 1992–93 on individual time allocation, relative productivity by age and sex, and caloric costs of activities to estimate age schedules of average consumption and production. Using these, they investigate the net costs of children to their parents and find that children have a negative net asset value up to the time they leave home. The direction of net wealth flows in this group is downward, from older to younger, and in economic terms the internal rate of return to children is highly negative up to the time they leave home. Nonetheless, children play a critically important role in the family's economic life cycle. On average, girls offset 76 percent of their consumption costs before leaving home at age 19, and boys offset 82 percent before leaving home at 22. Without the contributions from children as a group, parents would have to double or triple their work effort during part of the family life cycle if they were to raise the same number of children. By the thirteenth year of the family life cycle, children as a group produce more than half of what they consume in every year, and after the twentieth year children produce more than 80 percent of what they as a group consume. The authors also find that the elderly in the sample, ages 50 to 65, produce more than they consume. Thus while children have a negative net asset value to parents, the timing of their children's economic contribution across the family life cycle plays a key role in underwriting the cost of large families.     

Children of Migrants: The Cumulative Impact of Parental Migration on Children’s Education and Health Outcomes in China

Since the end of 1990s, approximately 160 million Chinese rural workers migrated to cities for work. Because of restrictions on migrant access to local health and education systems, many rural children are left behind in home villages to grow up without parental care. This article examines how exposure to cumulative parental migration affects children’s health and education outcomes. Using the Rural-Urban Migration Survey in China (RUMiC) data, we measure the share of children’s lifetime during which parents were away from home. We instrument this measure of parental absence with weather changes in their home villages when parents were aged 16–25, when they were most likely to initiate migration. Results show a sizable adverse effect of exposure to parental migration on the health and education outcomes of children: in particular, boys. We also find that the use of the contemporaneous measure for parental migration in previous studies is likely to underestimate the effect of exposure to parental migration on children’s outcomes.     

Children’s Development and Parental Input: Evidence From the UK Millennium Cohort Study

In this study, we use the UK Millennium Cohort Study to estimate a dynamic factor model of child development. Our model follows the children from birth until 7 years of age and allows for both cognitive and noncognitive abilities in children. We find a significant self-productivity effect in both cognitive and noncognitive development, as well as some evidence of dynamic dependence across different abilities. The activities that parents carry out with children at home (parental investment) have a significant effect on children’s development; we find substantial evidence of two distinct latent parental investment variables with differential effects across the two abilities.     

Economic and cultural influences on the decision to leave home in Peninsular Malaysia

Although the departure of children from the parental home is an important life-cycle event, few studies have investigated nest-leaving in developing countries. Using retrospective data from the Second Malaysian Family Life Survey, we estimate hazard models of nest-leaving in Peninsular Malaysia. We find that the departure of children, especially sons, responds to economic incentives, including housing costs, family businesses, education, and economic growth, and that ethnic differences in nest-leaving are important. We also find that the median age of departure from home has declined sharply over the past 40 years, a period of rapid social and economic change in Malaysia.     

Gender,Turning Points,and Boomerangs: Returning Home in Young Adulthood in Great Britain

The idea of a generation of young adults “boomeranging” back to the parental home has gained widespread currency in the British popular press. However, there is little empirical research identifying either increasing rates of returning home or the factors associated with this trend. This article addresses this gap in the literature using data from a long-running household panel survey to examine the occurrence and determinants of returning to the parental home. We take advantage of the longitudinal design of the British Household Panel Survey (1991–2008) and situate returning home in the context of other life-course transitions. We demonstrate how turning points in an individual’s life course—such as leaving full-time education, unemployment, or partnership dissolution—are key determinants of returning home. An increasingly unpredictable labor market means that employment cannot be taken for granted following university graduation, and returning home upon completion of higher education is becoming normative. We also find that gender moderates the relationship among partnership dissolution, parenthood, and returning to the parental home, reflecting the differential welfare support in Great Britain for single parents compared with nonresident fathers and childless young adults.     

Family policy and maternal employment in the Czech transition: a natural experiment

Czech family policies have gone through dramatic changes since the 1989 transition to a market economy, resulting into the highest employment gap between women with and without pre-school children in OECD. This paper focuses on the 1995 Czech Parental Benefit reform which extended the payment of universal parental benefits to 4 years instead of 3 without an equivalent extension of job-protected parental leave, leaving to mothers the choice of either guaranteed return to employment or an additional 12 months of benefits. The study relies on a difference-in-differences strategy to assess the net effect of this large-scale reform on mothers’ labour market participation. I find a strong negative impact on mothers’ probability of return to work at the end of parental leave, with a heterogeneous size with respect to their educational attainment. I also find evidence of the persistence of this detrimental effect on mothers’ employment beyond the short-term horizon targeted by the legislators.     

New insights into the Far Eastern pattern of mortality

This paper investigates the consequences of using different economic status proxies on the estimated impact of economic status and other determinants of fertility. Using micro survey data from Ghana and Peru, we find that the proxies for income that best predict fertility are a principal components score of the ownership of consumer durable goods and a simple sum of ownership of these durable goods. Furthermore, the choice of the proxy generally has a minor influence on the predicted effects of the control variables. We compare the results from using a restricted set of proxies, such as those available in the Demographic and Health Surveys, with the results obtained using a lengthier set of proxies. Our results suggest implications beyond fertility analyses by providing researchers with an awareness of the sensitivity of microanalyses to the treatment of economic status. Our results also suggest practical recommendations for the collection of survey data.     

Economic status proxies in studies of fertility in developing countries: Does the measure matter?

This paper investigates the consequences of using different economic status proxies on the estimated impact of economic status and other determinants of fertility. Using micro survey data from Ghana and Peru, we find that the proxies for income that best predict fertility are a principal components score of the ownership of consumer durable goods and a simple sum of ownership of these durable goods. Furthermore, the choice of the proxy generally has a minor influence on the predicted effects of the control variables. We compare the results from using a restricted set of proxies, such as those available in the Demographic and Health Surveys, with the results obtained using a lengthier set of proxies. Our results suggest implications beyond fertility analyses by providing researchers with an awareness of the sensitivity of microanalyses to the treatment of economic status. Our results also suggest practical recommendations for the collection of survey data.     

Family and sociodemographic influences on patterns of leaving home in Postwar Britain

We identify child-level and parent-level characteristics associated with children’s patterns of leaving home. We use a multilevel discrete-time hazards model to examine the impact of family and demographic factors at both levels, and utilize the Alternating Conditional Expectation algorithm optimally to transform the dependent and independent variables. We find that measured variables at both the child and the parent level have important influences, as do period and cohort factors. However, unmeasured parent-level factors have an influence on the departure of children that is broadly similar in magnitude to measured factors.     

Constraints,Satisfaction and Residential Mobility: Speare’s Model Reconsidered

Our study has shown that the stress threshold model, as formulated by Speare, only works partially. Consistent with Speare's model, we have found that subjective satisfaction is a strong predictor of thoughts about moving. Thoughts about moving is a good predictor of actual mobility. There are, however, three major problems with the model: stress as measured by satisfaction is not a particularly good predictor of actual mobility, although it does have some indirect influence through thoughts about moving; the "structural" variables have a strong independent impact on the mobility process beyond satisfaction; the satisfaction variables have little influence in mediating the effects of structural variables on mobility thoughts and behavior. The question of why our results differ from Speare's cannot be definitively answered here. We believe that our research has certain virtues in its direct measurement of satisfaction with home and community and also its much larger sample of movers. Speare's sample may have the virtue of being more representative of a large urban population since it was drawn from all segments of Rhode Island. Yet, while our sample is selective of areas within Seattle, we believe it provides a good representation of a wide variety of residential environments. Overall, our results are more consistent with the other studies which have addressed these issues (Bach and Smith, 1977; Lee, 1978; Michelson, 1977; Newman and Duncan, 1979), although the methods and approaches are not identical. Some of these studies were reviewed in the first part of the paper. We believe that understanding of the attitudinal predictors of changing residence is roughly at the same stage as research in the early post-World War II period on the attitudinal correlates of fertility behavior among American women. Research such as the Princeton study (Westoff et al., 1961; 1963) demonstrated that a variety of social attitudes about home, family, work and childbearing correlated poorly with levels of fertility. In contrast, such variables as objective religious affiliation, educational attainment, and race were clear correlates of fertility behavior. We still do not fully understand why these structural variables are important but we know that they are key predictors of behavior.(ABSTRACT TRUNCATED AT 400 WORDS)     

Divorce,living arrangements,and material well-being during the transition to adulthood in rural Malawi

In this paper, we use longitudinal data to investigate how parental death and divorce influence young women’s own experience of divorce in Malawi, a setting where women marry relatively early and unions are fragile. We find that maternal death and parental divorce are positively associated with divorce for young women but, after controlling for socio-demographic and marital characteristics, only the association with maternal death remains statistically significant. Maternal and paternal death are both strongly associated with women’s post-divorce living arrangements, which in turn affects their material well-being. This finding suggests that divorcing at a young age shapes the subsequent life chances of women; although some women return to their parental home and may have the opportunity to reset the transition to adulthood, other women begin their 20s as head of their own household and with considerable material disadvantage.     

Economic incentives and the timing of births: evidence from the German parental benefit reform of 2007

Economic theory suggests that incentives matter for people’s decisions. This paper investigates whether this also holds for less self-evident areas of life such as the timing of births. We use a natural experiment when the German government changed its parental benefit system on January 1, 2007. The policy change strongly increased economic incentives for women to postpone delivery provided that they were employed. Applying a difference-in-difference-in-difference approach, we find very strong evidence that women with an employment history near to the end of their term indeed succeeded to shift births to the New Year and, therefore, could benefit from the new and more generous parental benefit system. Suggesting a model of chain reactions, we also report evidence that some women with due dates earlier in December tried but did not succeed to shift births to the New Year.     

The transition to tertiary education and parental background over time

We analyze the role of parental background for transitions to tertiary education in Germany and answer three questions: (a) does the relevance of parental background shift from short-term (contemporary income) to long factors (ability, parental education) at higher levels of education? (b) Did the impact of parental background on participation in tertiary education change over time? (c) Are there different patterns by sex and region? Parental income significantly affects transitions to tertiary education. Its impact seems to have lost magnitude over time. We find no clear differences by sex and larger parental income effects in West than in East Germany.     

Parental Leave Take-Up of Fathers in Luxembourg

The study uses administrative data from Luxembourg to investigate fathers’ decisions to use parental leave. We focus on two measures of opportunity cost: the difference between the parental leave benefit and the salary of the father and the mean salary growth for a period of 6 months for each father. The first measure captures the direct opportunity cost, while the second is a proxy for foregone promotion opportunities. We use Cox proportional hazards model for the analysis. The results suggest a negative relationship between foregone income and taking parental leave. Surprisingly, salary growth appears to be positively related to the hazard of taking parental leave. Coefficients of control variables are in line with previous findings: fathers are more likely to use parental leave if they work in larger organization and for the first child.