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Analysis of Economic Theories on Family: Behavior, Health, Fertility, Marriage, Divorce, a, Exams of Economics

A field exam for economic demography from the university of california, berkeley's department of economics. It covers the economic theories of family behavior, specifically fertility, marriage, and divorce, and their applicability to third world countries. The exam also explores the interaction between health and socioeconomic status and the identification of causal relationships between the two. Additionally, it discusses the effect of education on older-age mortality.

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Uploaded on 12/04/2012

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Department of Economics
University of California, Berkeley
January 15, 2008
Field Exam for Economic Demography
Please answer all parts of all questions. The four numbered questions count equally in the
grade. Cite the literature where appropriate. You have three hours. You should allocate
roughly 45 minutes to each question. You may use a calculator for Question 4.
1) The economic theories of family behavior, specifically fertility, marriage and divorce,
were primarily developed for the context of developed nations like the US or Europe.
a. Without going into mathematical detail, describe the key assumptions made in
these theories. You can choose some specific version of the theories, such as
Becker’s (with or without co-authors), or you can answer the question more
generally.
b. What problems are encountered in using these theories to interpret family
behavior in the context of Third World countries? You can choose some
particular region of the Third World as a context for your discussion, such as
East or South Asia, Latin America or Sub-Saharan Africa.
c. Assess the overall usefulness of these theories for understanding family
behavior in the context you chose, given any difficulties you may have
identified in b above. What useful insights for this context, if any, are
provided by these theories? How might they guide empirical research?
2) Health and socioeconomic status interact in complex ways over the life cycle.
a. Describe the key elements of this interaction, citing relevant studies.
b. One consequence is that the inference of causal relationships between the two
is difficult. Discuss these difficulties.
c. What strategies have been employed, or would you suggest, for identifying
these relationships?
3) In empirical studies, it is often found that local labor markets with higher proportions
of foreign born also have higher wages. Think of our discussions of causal analysis,
and the article by Moffitt on this subject.
a. (3) What should we take to be the treatment here, of which we are trying to assess
the effect? What is the counterfactual? (Math expressions are not needed here, but
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Department of Economics University of California, Berkeley January 15, 2008

Field Exam for Economic Demography

Please answer all parts of all questions. The four numbered questions count equally in the grade. Cite the literature where appropriate. You have three hours. You should allocate roughly 45 minutes to each question. You may use a calculator for Question 4.

  1. The economic theories of family behavior, specifically fertility, marriage and divorce, were primarily developed for the context of developed nations like the US or Europe.

a. Without going into mathematical detail, describe the key assumptions made in these theories. You can choose some specific version of the theories, such as Becker’s (with or without co-authors), or you can answer the question more generally.

b. What problems are encountered in using these theories to interpret family behavior in the context of Third World countries? You can choose some particular region of the Third World as a context for your discussion, such as East or South Asia, Latin America or Sub-Saharan Africa.

c. Assess the overall usefulness of these theories for understanding family behavior in the context you chose, given any difficulties you may have identified in b above. What useful insights for this context, if any, are provided by these theories? How might they guide empirical research?

  1. Health and socioeconomic status interact in complex ways over the life cycle.

a. Describe the key elements of this interaction, citing relevant studies.

b. One consequence is that the inference of causal relationships between the two is difficult. Discuss these difficulties.

c. What strategies have been employed, or would you suggest, for identifying these relationships?

  1. In empirical studies, it is often found that local labor markets with higher proportions of foreign born also have higher wages. Think of our discussions of causal analysis, and the article by Moffitt on this subject.

a. (3) What should we take to be the treatment here, of which we are trying to assess the effect? What is the counterfactual? (Math expressions are not needed here, but

feel free to use them if you prefer.)

b. (3) How would you interpret the result or association described above in terms of causality?

c. (6) What strategies might you suggest for obtaining a better estimate of the effect of the treatment? Draw on the methods that have been used in the literature we read (the readings by Card and Borjas, as well as any other studies discussed in class).

d. (4) What results have been found when these strategies have been pursued?

e. (4) Are there additional problems with this approach (comparing outcomes across local labor markets) that do not fit so cleanly into the causality framework discussed by Moffitt? Discuss.

  1. The table below pertains to the cohort of U.S. women born in 1934, reaching age 74 this year. Forecasts of the proportion surviving to later ages (lx) and the corresponding hazard rates (hx) for age x have been constructed using the model of Ronald Lee and Larry Carter. They are shown along with exponentials and logarithms of the tabulated values, which are included to reduce the labor of calculations. If required, the area under an exponential curve can be found from the formula ( exp(bc) - exp(ac))/c, when the curve is given by exp(cx) and the area is measured between x = a and x = b.

The entries in the table are baseline values for women with high-school educations. Using data from the National Longitudinal Mortality Study, Michael Dennis has estimated effects of differing educational levels on older-age mortality.

a) At age 74, the estimated effect on the hazard function of having some college education as compared with a high-school education is given by a proportionality factor of exp(-0.1176). The proportionality factor for having less than a high-school education is exp(+0.1530). Suppose these factors stayed in effect for all ages above

  1. Compare the proportion surviving from 74 to 80 for those with some college education to the same proportion for those with less than high-school education.

b) Make the same assumptions as in Part (a). At what age would a person with some college education die, if that person's death came at the 50th percentile of the distribution of ages at death for everyone with some college education alive at age 74?

c) An alternative to the Lee-Carter predictions would be a Gompertz model with the same hazard rate at age 74 and a Gompertz slope parameter of beta = .1058 per year. Write down the equation for the hazard function for such a Gompertz model and an equation for the proportion surviving to age x among those alive at age 74. Find the implied proportion of the cohort surviving to age 99, for individuals with the baseline