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Aggregate and Intergenerational Implications of School Closures: A Quantitative Assessment

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  • Jang, Youngsoo
  • Yum, Minchul
Abstract
This paper quantitatively investigates the macroeconomic and distributional consequences of school closures through intergenerational channels in the medium- and long-term. The model economy is a dynastic overlapping generations general equilibrium model in which schools, in the form of public education investments, complement parental investments in producing children's human capital. We find that unexpected school closure shocks have moderate long-lasting adverse effects on macroeconomic aggregates and reduce intergenerational mobility, especially among older children. Lower substitutability between public and parental investments induces larger damages in the aggregate economy and overall incomes of the affected children, while mitigating negative impacts on intergenerational mobility.

Suggested Citation

  • Jang, Youngsoo & Yum, Minchul, 2020. "Aggregate and Intergenerational Implications of School Closures: A Quantitative Assessment," MPRA Paper 107593, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:107593
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    Cited by:

    1. Suzane Bellue, 2023. "Why Don’t Poor Families Move? A Spatial Equilibirum Analysis of Parental Decisions with Social Learning," CRC TR 224 Discussion Paper Series crctr224_2023_472, University of Bonn and University of Mannheim, Germany.
    2. Kurmann, André & Lalé, Etienne, 2021. "School Closures and Effective In-Person Learning during COVID-19: When, Where, and for Whom," School of Economics Working Paper Series 2021-18, LeBow College of Business, Drexel University.
    3. Marc Diederichs & Reyn van Ewijk & Ingo E. Isphording & Nico Pestel, 2022. "Schools under mandatory testing can mitigate the spread of SARS-CoV-2," Proceedings of the National Academy of Sciences, Proceedings of the National Academy of Sciences, vol. 119(26), pages 2201724119-, June.
    4. Guido Neidhöfer & Nora Lustig & Mariano Tommasi, 2021. "Intergenerational transmission of lockdown consequences: prognosis of the longer-run persistence of COVID-19 in Latin America," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 19(3), pages 571-598, September.
    5. Jo Blanden & Matthias Doepke & Jan Stuhler, 2022. "Education inequality," CEP Discussion Papers dp1849, Centre for Economic Performance, LSE.
    6. Nicola Fuchs-Schündeln, 2022. "Covid-Induced School Closures in the US and Germany: Long-Term Distributional Effects," CESifo Working Paper Series 9698, CESifo.
    7. Nicola Fuchs-Schündeln & Dirk Krueger & André Kurmann & Etienne Lalé & Alexander Ludwig & Irina Popova, 2023. "The Fiscal and Welfare Effects of Policy Responses to the Covid-19 School Closures," IMF Economic Review, Palgrave Macmillan;International Monetary Fund, vol. 71(1), pages 35-98, March.
    8. Nicola Fuchs-Schünde & Dirk Krueger & Alexander Ludwig & Irina Popova, 2022. "The Long-Term Distributional and Welfare Effects of Covid-19 School Closures," The Economic Journal, Royal Economic Society, vol. 132(645), pages 1647-1683.
    9. Titan Alon & Sena Coskun & Matthias Doepke & David Koll & Michèle Tertilt, 2022. "From Mancession to Shecession: Women’s Employment in Regular and Pandemic Recessions," NBER Macroeconomics Annual, University of Chicago Press, vol. 36(1), pages 83-151.
    10. Agostinelli, Francesco & Doepke, Matthias & Sorrenti, Giuseppe & Zilibotti, Fabrizio, 2022. "When the great equalizer shuts down: Schools, peers, and parents in pandemic times," Journal of Public Economics, Elsevier, vol. 206(C).
    11. Makoto Nirei & Nao Sudo, 2020. "Necessities, Home Production, and Economic Impacts of Stay-at-Home Policies," IMES Discussion Paper Series 20-E-14, Institute for Monetary and Economic Studies, Bank of Japan.
    12. Nicola Fuchs-Schündeln, 2022. "Covid-induced school closures in the United States and Germany: long-term distributional effects," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 37(112), pages 609-639.
    13. Werner, Katharina & Woessmann, Ludger, 2021. "The Legacy of COVID-19 in Education," IZA Discussion Papers 14796, Institute of Labor Economics (IZA).
    14. Aparicio Fenoll, Ainoa, 2022. "The Uneven Effect of COVID School Closures: Parents in Teleworkable vs. Non-teleworkable Occupations," IZA Discussion Papers 15754, Institute of Labor Economics (IZA).
    15. Madeline Duhon & Lia Fernald & Joan Hamory & Edward Miguel & Eric Ochieng & Michael W. Walker, 2024. "Intergenerational Human Capital Impacts and Complementarities in Kenya," NBER Working Papers 32617, National Bureau of Economic Research, Inc.

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    More about this item

    Keywords

    Intergenerational mobility; lifetime income; parental investments; aggregate loss; substitutability;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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