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A field exam from the university of california, berkeley's department of economics, focusing on economic demography. Topics include the rising age at first marriage, improvements in health and longevity, the relationship between public education and pensions, and fertility trends. Students are expected to answer all questions, cite literature, and allocate approximately 45 minutes to each question.
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Department of Economics University of California, Berkeley January 10, 2007
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.
a. According to a theory proposed by Becker and Murphy, the introduction of public education might be linked to the introduction of public pensions. Briefly outline the theory and explain how the linked introduction of these programs might achieve efficiency gains. b. From a societal point of view, would the optimal saving rate be higher or lower in an aging population than in a young one? (refer to Cutler et al, 1990) Explain your answer. Would it matter whether population was aging due to low fertility or to longer life? c. If both numbers of children and quality of children are normal goods, then why has fertility tended to fall as income has risen, either over time or in the cross section? What is the basic insight that the quantity-quality theory offers on this point? d. The use of modern contraceptives leads to lower fertility, and family planning programs facilitate access to modern contraceptives. Why, then, is it difficult to assess the role of family planning programs as a causal factor for fertility decline in the Third World? Refer to the literature.
a. The notes appear to contain these 10 Lx 's for x = 0, 10, 20, ..., 80: 9.44, 8.91, 8.54, 8.02, 7.44, 7.07, 6.1, 2.95, 1.5. Calculate the expectation of life at birth.
b. The notes also reveal that in the last year, while mortality rates have remained unchanged, fertility rates may have dropped so that, if the new rates were held constant, the long term consequence would be zero growth. Estimate the size of the ultimate stationary population in relation to the current population.
c. Estimate the change in the proportion of the population aged 60-80 with the change in the growth rate.
d. The notes also hint that the population growth rate may have dropped from 2% to 1% about 60 years ago. Make a new estimate of your answer to part (c).