Parental Pressure and Intergenerational Mobility in Education [pdf]
Abstract: High school graduates in Germany who lack parents with college experience are 40 percentage points less likely to attend college than those with college-educated parents. This study provides evidence that parental influence explains a significant portion of this socio-economic gap through at least two channels: one, parental pressure and two, the intergenerational transmission of beliefs and preferences. To understand parental influence, I conduct a field experiment with 2,065 students and parents in Germany. Importantly, I experimentally make students' stated college plans visible to parents. In the first finding, visibility to parents doubles the socio-economic gap in college plans to 26 percentage points. This is mainly driven by an increase in college plans among students with college-educated parents. Furthermore, students' stated plans are more predictive of eventual choices when they are visible to parents than when they are not. This implies that perceived parental expectations not only influence stated plans, but likely also ultimate decisions. To disentangle mechanisms, I collect detailed survey data on students' and parents' subjective expectations for various career tracks and estimate a structural model of career choice under uncertainty. Model simulations indicate that 45% of the socio-economic gap in college plans is explained by parental pressure and 51% by students internalizing family-specific beliefs and preferences.
Presented at: Düsseldorf Institute for Competition Economics, Graduate Students in Economics of Education Zoom Seminars (GEEZ), The 34th Annual Conference of the European Society for Population Economics in Barcelona (ESPE), ifo Conference on Genes, Social Mobility, and Inequalities across the Life-Course, Young Economist Symposium 2021 (YES), Zeuthen Workshop on Inequality and Public Policy, European Association of Labour Economists Virtual Conference Padua 2021 (EALE), 6th IZA Workshop: The Economics of Education, UC Berkeley BEHL Lunch, UC Berkeley Psychology & Economics Seminar, Advances with Field Experiments (AFE) 2022, SITE Experimental Economics 2022, Field Experiments in Economics and Business (Heilbronn), Tilburg University, CESifo / ifo Junior Workshop on the Economics of Education
Selective Memory around Big Life Decisions [pdf]
Abstract: Selective memory can lead people to mistake life outcomes as what they always wanted. Using data on past fertility desires from a panel tracking fertility preferences and actual fertility for 3,936 Kenyans from their early twenties to their thirties, I provide monetary incentives to remember and to be reminded of past desires. I find that: (i) 29% of respondents have more children by their thirties than once desired; (ii) despite incentives, especially respondents with excess fertility misremember past desires in the direction of current fertility and do not want to be reminded of them, consistent with motivated memory; (iii) selective memory affects the intergenerational transmission of fertility preferences.
Presented at: UC Berkeley Development Lunch, Pacific Conference for Development Economics 2021 (PacDev), Psychology and Economics of Poverty (PEP) Convening, 25th Annual Society for Institutional and Organizational Economics (SIOE), National University of Singapore, CESifo Area Conference on Behavioral Economics 2022
(Media) Coverage: Roland Bénabou's 2021 Jean-Jacques Laffont Prize lecture on "Beliefs and Misbeliefs: The Economics of Wishful Thinking", video here (1:04:24 to 1:09:40)
Abstract: This paper examines how beliefs and preferences drive identity-conforming consumption or investments. We introduce a theory that explains how identity distorts individuals' beliefs about potential outcomes and imposes psychic costs on benefiting from identity-incongruent sources. We substantiate our theoretical foundation through two lab-in-field experiments on soccer betting in Kenya and the UK, where participants either had established affiliations with the teams involved or assumed a neutral stance. The results indicate that soccer fans have overoptimistic beliefs about match outcomes that align with their identity and bet significantly higher amounts on those than on outcomes of comparable games where they are neutral. After accounting for individuals' beliefs and risk preferences, our structural estimates reveal that participants undervalue gains from identity-incongruent assets by 9% to 27%. Our counterfactual simulations imply that identity-specific beliefs account for 30% to 44% of the investment differences between neutral observers and supporters, with the remainder being due to identity preferences.
Presented at: Stanford GSB*, ERINN, SITE Experimental Economics 2022*, Tsinghua BEAT 2023*, ASSA 2023*, UMich*, NUS*, Northwestern Kellogg*, MIT Sloan*, Cornell*, QME*, Lausanne*, Fribourg*, Uppsala*, Frankfurt, and briq (* - presented by co-authors)
Abstract: Fertility preferences have long played a key role in models of fertility differentials and change. We examine the stability of preferences over time using rich panel data on Kenyan women’s fertility desires, expectations, actual fertility, and recall of desires in three waves over a nine-year period, when respondents were in their 20s. We find that although desired fertility is quite unstable, most women perceive their desires to be stable. Under hypothetical future scenarios, few expect their desired fertility to increase over time but, in fact, such increases in fertility desires are common. Moreover, when asked to recall past desires, most respondents report previously wanting exactly as many children as they desire today. These patterns of bias are consistent with the emerging view that fertility desires are contextual, emotionally laden, and structured by identity.
Media Coverage: Marginal Revolution
Work in Progress
More drafts to come soon...