[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/wpc/wplist/wp02_01.html
   My bibliography  Save this paper

JOINT DECISIONS ON HOUSEHOLD MEMBERSHIP AND HUMAN CAPITAL ACCUMULATION OF YOUTHS The role of expected earnings and local markets

Author

Listed:
  • Gianna Claudia Giannelli
  • Chiara Monfardini
Abstract
This paper analyses the effects of expected earnings and local markets conditions on the behaviour of young adults with high school diplomas. Decisions to either remain in the parental home or form a new household are modelled jointly with those of either gaining work experience or investing in a university education. A multinomial probit model estimates the probabilities of the different pairs of outcomes. Expected lifetime earnings of youths are modelled and estimated, and serve as choicespecific regressors in the probit model. According to our results, the most important factor influencing the choice of studying and residing with parents is expected lifetime earnings from a university degree. A sizeable discouraged worker effect induces young people to study when labour market opportunities are poor. The cost of housing greatly influences the choice of working and living in the parental home. Two policy experiments offer some suggestions for policy makers. The first one measures the extent to which housing policies, targeted at reducing housing costs, would allow youths to live away from the parental home. A second indicates how much labour market policies, targeted at lowering youth unemployment to some desired levels, could decrease the number of discouraged workers that choose to study.

Suggested Citation

  • Gianna Claudia Giannelli & Chiara Monfardini, 2001. "JOINT DECISIONS ON HOUSEHOLD MEMBERSHIP AND HUMAN CAPITAL ACCUMULATION OF YOUTHS The role of expected earnings and local markets," CHILD Working Papers wp02_01, CHILD - Centre for Household, Income, Labour and Demographic economics - ITALY.
    • Handle: RePEc:wpc:wplist:wp02_01
    as

    Download full text from publisher

    File URL: http://www.child.carloalberto.org/images/wp/child2_2001.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Maite Martínez-Granado & Javier Ruiz-Castillo, 2002. "The decisions of Spanish youth: A cross-section study," Journal of Population Economics, Springer;European Society for Population Economics, vol. 15(2), pages 305-330.
    2. Guiso, Luigi & Jappelli, Tullio, 2002. "Private Transfers, Borrowing Constraints and the Timing of Homeownership," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 34(2), pages 315-339, May.
    3. Brunello, Giorgio & Lupi, Claudio & Ordine, Patrizia, 2001. "Widening differences in Italian regional unemployment," Labour Economics, Elsevier, vol. 8(1), pages 103-129, January.
    4. McElroy, Marjorie B, 1985. "The Joint Determination of Household Membership and Market Work: The Case of Young Men," Journal of Labor Economics, University of Chicago Press, vol. 3(3), pages 293-316, July.
    5. Stern, Steven, 1989. "Rules of thumb for comparing multinomial logit and multinomial probit coefficients," Economics Letters, Elsevier, vol. 31(3), pages 235-238, December.
    6. David M. Blau, 1999. "The Effect Of Income On Child Development," The Review of Economics and Statistics, MIT Press, vol. 81(2), pages 261-276, May.
    7. Gianna Claudia Giannelli & Chiara Monfardini, 2000. "A nest or a golden cage?," International Journal of Manpower, Emerald Group Publishing Limited, vol. 21(3/4), pages 227-245, May.
    8. Patricia Rice, 1999. "The impact of local labour markets on investment in further education: Evidence from the England and Wales youth cohort studies," Journal of Population Economics, Springer;European Society for Population Economics, vol. 12(2), pages 287-312.
    9. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 31(3), pages 129-137.
    10. Keane, Michael P, 1992. "A Note on Identification in the Multinomial Probit Model," Journal of Business & Economic Statistics, American Statistical Association, vol. 10(2), pages 193-200, April.
    11. Ermisch, John F, 1996. "Parental Support for Human Capital Investment by Young Adults," CEPR Discussion Papers 1536, C.E.P.R. Discussion Papers.
    12. Rosenzweig, Mark R & Wolpin, Kenneth I, 1993. "Intergenerational Support and the Life-Cycle Incomes of Young Men and Their Parents: Human Capital Investments, Coresidence, and Intergenerational Financial Transfers," Journal of Labor Economics, University of Chicago Press, vol. 11(1), pages 84-112, January.
    13. Moulton, Brent R, 1990. "An Illustration of a Pitfall in Estimating the Effects of Aggregate Variables on Micro Unit," The Review of Economics and Statistics, MIT Press, vol. 72(2), pages 334-338, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. G. C. Giannelli & C. Monfardini, 2000. "Joint Decisions on Household Membership and Human Capital Accumulation of Youths: The role of expected carnings and labour market rationing," Working Papers 375, Dipartimento Scienze Economiche, Universita' di Bologna.
    2. Francisco Maeso & Ildefonso Mendez, 2008. "The Role of Partnership Status and Expectations on the Emancipation Behaviour of Spanish Graduates," Working Papers wp2008_0812, CEMFI.
    3. Deborah Cobb-Clark & Tue Gørgens, 2014. "Parents’ economic support of young-adult children: do socioeconomic circumstances matter?," Journal of Population Economics, Springer;European Society for Population Economics, vol. 27(2), pages 447-471, April.
    4. Anne Laferrere, 2005. "Leaving the Nest : The Interaction of Parental Income and Family Environment," Working Papers 2005-01, Center for Research in Economics and Statistics.
    5. Sascha Becker & Samuel Bentolila & Ana Fernandes & Andrea Ichino, 2010. "Youth emancipation and perceived job insecurity of parents and children," Journal of Population Economics, Springer;European Society for Population Economics, vol. 23(3), pages 1047-1071, June.
    6. Samuel Bentolila & Ildefonso Mendez & Francisco Maeso, 2015. "Leaving Home with a Partner," CESifo Working Paper Series 5381, CESifo.
    7. Becker, Sascha O. & Bentolila, Samuel & Fernandes, Ana & Ichino, Andrea, 2005. "Job Insecurity and Youth Emancipation: A Theoretical Approach," IZA Discussion Papers 1869, Institute of Labor Economics (IZA).
    8. Canada-Vicinay, Juan A., 2005. "Growing up in an intact vs. non-intact family and the transition from school to permanent work: A gender approach for Spain in 2000," Economics of Education Review, Elsevier, vol. 24(6), pages 691-704, December.
    9. David Blanc & François-Charles Wolff, 2006. "Leaving Home in Europe: The Role of Parents’ and Children’s Incomes," Review of Economics of the Household, Springer, vol. 4(1), pages 53-73, March.
    10. Pastore, Francesco, 2005. "To Study or to Work? Education and Labour Market Participation of Young People in Poland," IZA Discussion Papers 1793, Institute of Labor Economics (IZA).
    11. Mendez, Ildefonso, 2008. "The Role of Partnership Status and Expectations on the Emancipation Behaviour of Spanish Graduates," MPRA Paper 8655, University Library of Munich, Germany.
    12. Christopoulou, Rebekka & Pantalidou, Maria, 2017. "The parental home as labor market insurance for young Greeks during the crisis," GLO Discussion Paper Series 158, Global Labor Organization (GLO).
    13. Cobb-Clark, Deborah A., 2008. "Leaving Home: What Economics Has to Say about the Living Arrangements of Young Australians," IZA Discussion Papers 3309, Institute of Labor Economics (IZA).
    14. Christopoulou, Rebekka & Pantalidou, Maria, 2022. "The parental home as labor market insurance for young Greeks during the Great Recession," Journal of Demographic Economics, Cambridge University Press, vol. 88(3), pages 313-350, September.
    15. Ghignoni, Emanuela & Verashchagina, Alina, 2014. "Educational qualifications mismatch in Europe. Is it demand or supply driven?," Journal of Comparative Economics, Elsevier, vol. 42(3), pages 670-692.
    16. Fernandes Ana & Becker Sascha O & Bentolila Samuel & Ichino Andrea, 2008. "Income Insecurity and Youth Emancipation: A Theoretical Approach," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 8(1), pages 1-42, July.
    17. Maria Concetta Chiuri & Daniela Del Boca, 2008. "Household Membership Decisions of Adult Children: Does Gender and Institutions Matter?," Carlo Alberto Notebooks 75, Collegio Carlo Alberto.
    18. Chiuri, Maria Concetta & Del Boca, Daniela, 2008. "Household Membership Decisions of Adult Children," IZA Discussion Papers 3546, Institute of Labor Economics (IZA).
    19. Anne Laferrère & David le Blanc, 2004. "Gone with the Windfall: How Do Housing Allowances Affect Student Co-residence?," CESifo Economic Studies, CESifo Group, vol. 50(3), pages 451-477.

    More about this item

    Keywords

    living; arrangements; expected; lifetime; earnings; multinomial; probit;
    All these keywords.

    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wpc:wplist:wp02_01. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Giovanni Bert (email available below). General contact details of provider: https://edirc.repec.org/data/childit.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.