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Families as Shocks

Author

Listed:
  • Luis Cubbedu

    (IMF)

  • Jose-Victor Rios-Rull

    (University of Pennsylvania and CAERP)

Abstract

In this paper we show the quantitative importance of the process that determines changes in family composition to determine the main macroeconomic magnitudes. We do so by modelling family type as a stochastic process that affects households in a way similar to shocks to earnings. Agents respond to these process by optimally choosing savings. We show that the size of savings differs dramatically depending on the details of the stochastic process. The model is quantitative: its fundamental parameters are estimated using U.S. data.

Suggested Citation

  • Luis Cubbedu & Jose-Victor Rios-Rull, 2002. "Families as Shocks," Centro de Alti­simos Estudios Ri­os Pe©rez(CAERP) 1, Centro de Altisimos Estudios Rios Perez (CAERP).
    • Handle: RePEc:cae:caerpp:1
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    1. Why are so many elderly widows living alone?
      by Economic Logician in Economic Logic on 2009-08-20 19:28:00

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    Cited by:

    1. Jeremy Greenwood & Nezih Guner & Georgi Kocharkov & Cezar Santos, 2016. "Technology and the Changing Family: A Unified Model of Marriage, Divorce, Educational Attainment, and Married Female Labor-Force Participation," American Economic Journal: Macroeconomics, American Economic Association, vol. 8(1), pages 1-41, January.
    2. Jeremy Greenwood & Nezih Guner & Ricardo Marto, 2021. "The Great Transition: Kuznets Facts for Family-Economists," Economie d'Avant Garde Research Reports 33, Economie d'Avant Garde.
    3. Brian Gratton & Myron P. Gutmann, 2010. "Emptying the Nest: Older Men in the United States, 1880–2000," Population and Development Review, The Population Council, Inc., vol. 36(2), pages 331-356, June.
    4. Alejandrina Salcedo & Todd Schoellman & Michèle Tertilt, 2012. "Families as roommates: Changes in U.S. household size from 1850 to 2000," Quantitative Economics, Econometric Society, vol. 3(1), pages 133-175, March.
    5. Christian Alemán-Pericón & Daniela Iorio & Raül Santaeulàlia-Llopis, 2024. "A Quantitative Theory of the HIV Epidemic: Education, Risky Sex and Asymmetric Learning," Working Papers 1418, Barcelona School of Economics.
    6. Greg Kaplan, 2012. "Moving Back Home: Insurance against Labor Market Risk," Journal of Political Economy, University of Chicago Press, vol. 120(3), pages 446-512.
    7. Jeremy Greenwood & Nezih Guner, 2009. "Marriage and Divorce since World War II: Analyzing the Role of Technological Progress on the Formation of Households," NBER Chapters, in: NBER Macroeconomics Annual 2008, Volume 23, pages 231-276, National Bureau of Economic Research, Inc.
    8. Luca Pensieroso & Alessandro Sommacal, 2019. "Agriculture to Industry: the End of Intergenerational Coresidence," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 34, pages 87-102, October.
    9. De Magalhães, Leandro & Koh, Dongya & Santaeulàlia-Llopis, Räul, 2019. "The costs of consumption smoothing: less schooling and less nutrition," Journal of Demographic Economics, Cambridge University Press, vol. 85(3), pages 181-208, September.
    10. Lingguo Cheng & Hong Liu & Ye Zhang & Zhong Zhao, 2018. "The heterogeneous impact of pension income on elderly living arrangements: evidence from China’s new rural pension scheme," Journal of Population Economics, Springer;European Society for Population Economics, vol. 31(1), pages 155-192, January.
    11. Leandro De Magalhães & Dongya Koh & Raül Santaeulàlia-Llopis, 2016. "Consumption and Expenditure in Sub-Saharan Africa," Bristol Economics Discussion Papers 16/677, School of Economics, University of Bristol, UK, revised 07 Oct 2016.
    12. Hamermesh, Daniel S. & Myck, Michal & Oczkowska, Monika, 2021. "Widows' Time, Time Stress and Happiness: Adjusting to Loss," IZA Discussion Papers 14343, Institute of Labor Economics (IZA).
    13. Jie Pan & Gary Wagner, 2011. "The Effect of State Tax Preferences on the Living Arrangements of Elderly Individuals," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 17(2), pages 193-210, May.
    14. repec:kap:iaecre:v:17:y:2011:i:2:p:193-210 is not listed on IDEAS
    15. Saisawat Samutpradit, 2024. "Surviving Loss: Coping Strategies among Widow Households in Thai Rural Areas," PIER Discussion Papers 213, Puey Ungphakorn Institute for Economic Research.
    16. Bongoh Kye & Yool Choi, 2021. "Are parents and children coresiding less than before? An analysis of intergenerational coresidence in South Korea, 1980–2015," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 45(1), pages 1-16.
    17. Daichun Yi & Xiaoying Deng & Gang-Zhi Fan & Seow Eng Ong, 2018. "House Price and co-Residence with Older Parents: Evidence from China," The Journal of Real Estate Finance and Economics, Springer, vol. 57(3), pages 502-533, October.
    18. Pensieroso, Luca & Sommacal, Alessandro, 2014. "Economic development and family structure: From pater familias to the nuclear family," European Economic Review, Elsevier, vol. 71(C), pages 80-100.
    19. Emily Merchant & Brian Gratton & Myron Gutmann, 2012. "A Sudden Transition: Household Changes for Middle Aged U.S. Women in the Twentieth Century," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 31(5), pages 703-726, October.

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