Department of Economics

The neoclassical economics of childbearing turns 65 this year, marking the anniversary of Gary Becker's foundational article on the subject in 1960. This review article begins with a study of how childbearing has evolved in the United States over the last century, identifying distinctive features of the post-1960 era associated with the second demographic transition. Next, the article discusses standard neoclassical models of childbearing and shows how augmenting them with a supply side, including access to and information about contraception and abortion, increases their explanatory power. After reviewing recent quasi-experimental research testing this augmented model, the final part of the article reflects upon the implications of the recent transformation in US fertility rates for women and children and suggests fruitful avenues for future research.

We use administrative tax data to analyze the cumulative, long-run effects of California’s 2004 Paid Family Leave Act (CPFL) on women’s employment, earnings, and childbearing. A regression-discontinuity design exploits the sharp increase in the weeks of paid leave available under the law. We find no evidence that CPFL increased employment, boosted earnings, or encouraged childbearing, suggesting that CPFL had little effect on the gender pay gap or child penalty. For first-time mothers, we find that CPFL reduced employment and earnings a decade after they gave birth. (JEL H24, J13, J16, J31, J32, K31)

In the 1960s, two landmark statutes-the Equal Pay and Civil Rights Acts-targeted the long-standing practice of employment discrimination against U.S. women. For the next 15 years, the gender gap in median earnings among full-time, full-year workers changed little, leading many scholars to conclude that the legislation was ineffectual. This article revisits this conclusion using two research designs, which leverage (i) cross-state variation in preexisting state equal pay laws and (ii) variation in the 1960 gender gap across occupation-industry-state-group cells to capture differences in the legislation's incidence. Both designs suggest that federal antidiscrimination legislation led to striking gains in women's relative wages, which were concentrated among below-median wage earners. These wage gains offset preexisting labor market forces, which worked to depress women's relative pay growth, resulting in the apparent stability of the gender gap at the median and mean in the 1960s and 1970s. The data show little evidence of short-term changes in women's employment but suggest that firms reduced their hiring and promotion of women in the medium to long term. The historical record points to the key role of the Equal Pay Act in driving these changes.

We use novel, large-scale data on 17.5 million Americans to study how a policy-driven increase in economic resources affects children's long-term outcomes. Using the 2000 Census and 2001-13 American Community Survey linked to the Social Security Administration's NUMIDENT, we leverage the county-level rollout of the Food Stamps program between 1961 and 1975. We find that children with access to greater economic resources before age five have better outcomes as adults. The treatment-on-the-treated effects show a 6% of a standard deviation improvement in human capital, 3% of a standard deviation increase in economic self-sufficiency, 8% of a standard deviation increase in the quality of neighbourhood of residence, a 1.2-year increase in life expectancy, and a 0.5 percentage-point decrease in likelihood of being incarcerated. These estimates suggest that Food Stamps' transfer of resources to families is a highly cost-effective investment in young children, yielding a marginal value of public funds of approximately sixty-two.

This article examines the role of the Great Depression in shaping the intergenerational mobility of some of the most upwardly mobile cohorts of the twentieth century. Using newly linked census and vital records from the Longitudinal, Intergenerational Family Electronic Micro-database, we examine the occupational and educational mobility of more than 265,000 sons and daughters born in Ohio and North Carolina. We find that the deepest and most protracted downturn in U.S. history had limited effects on sons' intergenerational mobility but reduced daughters' intergenerational mobility.

In this paper I analyze the work on exchange rates and external imbalances by University of Chicago faculty members during the university’s first 100 years, 1892 to 1992. Many people associate Chicago’s views with Milton Friedman’s advocacy for flexible exchange rates. But, of course, there was much more than that, including the work of J. Laurence Laughlin on bimetallism, Jacob Viner on the balance of payments, Lloyd Metzler on transfers, Harry Johnson on trade and currencies, Lloyd Mints on exchange rate regimes, Robert Mundell on optimal currency areas, and Arnold Harberger on shadow exchange rates, among others. The analysis shows that, although different scholars emphasized different issues, there was a common thread in this research, anchored on the role of relative prices’ changes during the adjustment process.

Much of the increase in the prevalence of overweight and obesity has been in developing countries with a history of famines and malnutrition. This paper is the first to examine overweight among adult grandsons of grandfathers exposed to starvation during developmental ages. I study grandsons born to grandfathers who served in the Union Army during the US Civil War (1861-5) where some grandfathers experienced severe net malnutrition because they suffered a harsh POW experience. I find that male-line but not female-line grandsons of grandfathers who survived a severe captivity during their growing years faced a 21% increase in mean overweight and a 2% increase in mean BMI compared to grandsons of non-POWs. Male-line grandsons descended from grandfathers who experienced a harsh captivity faced a 22%-28% greater risk of dying every year after age 45 relative to grandsons descended from non-POWs, with overweight accounting for 9%-14% of the excess risk.

We use natality microdata covering the universe of US. births for 2015 to 2021 and California births from 2015 through February 2023 to examine childbearing responses to the COVID-19 pandemic. We find that 60% of the 2020 decline in US fertility rates was driven by sharp reductions in births to foreign-born mothers although births to this group comprised only 22% of all US births in 2019. This decline started in January 2020. In contrast, the COVID-19 recession resulted in an overall "baby bump" among US-born mothers, which marked the first reversal in declining fertility rates since the Great Recession. Births to US-born mothers fell by 31,000 in 2020 relative to a prepandemic trend but increased by 71,000 in 2021. The data for California suggest that US births remained elevated through February 2023. The baby bump was most pronounced for first births and women under age 25, suggesting that the pandemic led some women to start families earlier. Above age 25, the baby bump was most pronounced for women aged 30 to 34 and women with a college education. The 2021 to 2022 baby bump is especially remarkable given the large declines in fertility rates that would have been projected by standard statistical models.

This paper describes the creation of the Longitudinal, Intergenerational Family Electronic Micro-Database (LIFE-M), a new data resource linking vital records and decennial censuses for millions of individuals and families living in the late 19th and 20th centuries in the United States. This combination of records provides a life-course and intergenerational perspective on the evolution of health and economic outcomes. Vital records also enable the linkage of women, because they contain a crosswalk between women's birth (i.e., "maiden") and married names. We describe (1) the data sources, coverage, and linking sequence; (2) the process and supervised machine-learning methods to linking records longitudinally and across generations; and (3) the resulting linked samples, including linking rates, representativeness, and weights.

The 2022 John Bates Clark Medal of the American Economic Association was awarded to Oleg Itskhoki, Professor of Economics at the University of California, Los Angeles for his path breaking contributions in international economics. This article summarizes Oleg Itskhoki’s work and places it in the context of the broader literature and emphasizes how it has shed new light on a number of long-standing puzzles regarding the behavior of exchange rates and international relative prices more generally and their connection to macroeconomic fluctuations and government’s choices of monetary and fiscal policies.