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Inter-generational effect of parental time and its policy implications

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  • Zhu, Guozhong
  • Vural, Gulfer

Abstract

Motivated by the empirical fact that parents with more human capital spend more time teaching and taking care of their children, we develop and estimate a theoretical model in which altruistic parents pass their human capital on in two ways: goods investment and time investment. Based on the estimated model, we quantitatively assess how the two types of investment affect wage inequality and inter-generational mobility. Using the model to study the impacts of a public policy that taxes income to finance public schooling, we find significantly different policy effects in our model than in a model where time investment does not respond endogenously to the policy.

Suggested Citation

  • Zhu, Guozhong & Vural, Gulfer, 2013. "Inter-generational effect of parental time and its policy implications," Journal of Economic Dynamics and Control, Elsevier, vol. 37(9), pages 1833-1851.
  • Handle: RePEc:eee:dyncon:v:37:y:2013:i:9:p:1833-1851
    DOI: 10.1016/j.jedc.2013.04.013
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    Cited by:

    1. Yum, Minchul, 2016. "Parental time investment and intergenerational mobility," Working Papers 16-06, University of Mannheim, Department of Economics.
    2. Qin, Xuezheng & Wang, Tianyu & Zhuang, Castiel Chen, 2016. "Intergenerational transfer of human capital and its impact on income mobility: Evidence from China," China Economic Review, Elsevier, vol. 38(C), pages 306-321.
    3. Yang, Juan & Qiu, Muyuan, 2016. "The impact of education on income inequality and intergenerational mobility," China Economic Review, Elsevier, vol. 37(C), pages 110-125.
    4. Xiaoyan Chen Youderian, 2018. "On parental care and home production," Economics Bulletin, AccessEcon, vol. 38(1), pages 520-527.

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    More about this item

    Keywords

    Human capital production; Parental time investment; Wage inequality; Earnings persistence; Public schooling;
    All these keywords.

    JEL classification:

    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • R20 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - General
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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