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Economic conditions and the living arrangements of young adults: 1960 to 2011

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  • Jordan Matsudaira

Abstract

The recent economic downturn in the USA has coincided with stories of young men and women choosing to remain at home, or to move back in with their parents since they cannot afford to live independently. This paper first describes changes in parental coresidence over the last half-century, and then assesses the causal link between economic conditions and living arrangements among young adults using data on more than 15 million individuals from 1960 to 2011. Comparing changes in economic conditions across US states to changes in living arrangements, I find that fewer jobs, low wages, and high rental costs all lead to increases in the numbers of men and women living with their parents. The magnitudes of the effects are quite large: for men, I estimate that changes in economic factors alone are large enough to have caused the observed changes in parental coresidence between 1970 and 2011. Copyright Springer-Verlag Berlin Heidelberg 2016

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  • Jordan Matsudaira, 2016. "Economic conditions and the living arrangements of young adults: 1960 to 2011," Journal of Population Economics, Springer;European Society for Population Economics, vol. 29(1), pages 167-195, January.
    • Handle: RePEc:spr:jopoec:v:29:y:2016:i:1:p:167-195
    DOI: 10.1007/s00148-015-0555-y
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    14. 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).
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    17. Christopoulou, Rebekka & Pantalidou, Maria, 2018. "Who saved Greek youth? Parental support to young adults during the great recession," LSE Research Online Documents on Economics 91954, London School of Economics and Political Science, LSE Library.
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    21. Kimbrough, Gray, 2018. "Xboxes and Ex-workers? Gaming and Labor Supply of Young Adults in the U.S," MPRA Paper 87311, University Library of Munich, Germany.
    22. Whelan, Stephen & Atalay, Kadir & Barrett, Garry & Cigdem, Melek & Edwards, Rebecca, 2023. "Transitions into home ownership: a quantitative assessment," SocArXiv 34xjf, Center for Open Science.
    23. Chan, Sewin & O'Regan, Katherine & You, Wei, 2021. "Migration choices of the boomerang generation: Does returning home dampen labor market adjustment?," Journal of Housing Economics, Elsevier, vol. 53(C).
    24. Le Gallo, Julie & L'Horty, Yannick & Petit, Pascale, 2017. "Does enhanced mobility of young people improve employment and housing outcomes? Evidence from a large and controlled experiment in France," Journal of Urban Economics, Elsevier, vol. 97(C), pages 1-14.

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    More about this item

    Keywords

    Living arrangements; Impact of the great recession; Parental coresidence; Household formation; J11; J12; R20;
    All these keywords.

    JEL classification:

    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • R20 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - General

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