Centuries before the demographic transition, the European Marriage Pattern (EMP) limited fertility in Western Europe through high celibacy, late age at first marriage, and nuclear household structures. This paper uncovers an institutional factor that shaped the EMP: inheritance customs. We construct a novel atlas of 200 local inheritance customs in pre-industrial France and Belgium and examine individual-level marriage decisions from genealogical records of 53,672 women born in 1670–1750. We document two facts about the EMP: a substantial amount of local variation in its prevalence, and a U-shaped relationship between access to inheritance, women’s economic opportunities, and celibacy. This is consistent with inheritance customs affecting marriage decisions through women’s empowerment and eased financial constraints to form a household. These two channels allow to reconcile conflicting findings on the relationship between the EMP and economic development.

Are children of high-income families more likely to work at better-paying firms, and if so, why? This paper examines the role of one key potential explanation: differences in social networks. To do so, we use Canadian administrative data to construct an employee-employer-parent-child matched dataset, which we link to detailed educational records. We first show that, in an accounting sense, access to high-paying employers explains roughly half of the transmission of income across generations, as measured by the income rank-rank relationship. We then leverage rich education data to identify the impact of social connections on the probability of working at a given firm by comparing people who have the exact same degree but not the same connections. We find parental connections alone explain 10% of the firm-sorting component of intergenerational income rank-rank relationship. Finally, firm performance declines when parent business owners hire their own children, suggesting these children receive preferential treatment.

Co-Authors: Alice Kügler and Uta Schönberg

We investigate the consequences of structural change for workers displaced from the manufacturingsector. Manufacturing establishments traditionally employed low- and high-wage workers in similarproportions and paid substantial wage premiums to both types of workers. Structural change has ledto the disappearance of these jobs, particularly for low-wage workers. Decomposing displacementwage losses, we show that low-wage workers suffer considerable losses in establishment premiumsfollowing displacement, whereas high-wage workers tend to fall down the match quality ladder. Withongoing structural change, losses in wages and establishment premiums have increased over time,especially for low-wage workers, in part because they are increasingly forced to switch to low-knowledge service jobs where establishment premiums are low. Our findings further highlight thatstructural change and layoffs in manufacturing have significantly contributed to job polarization andthe rise in assortative matching of workers to firms.

This paper examines the relationship between wealth inequality and ethnic conflict in the German regions of Czechoslovakia (the so-called Sudetenland) during the interwar period. We utilise unique data on wealth inequality at the county level, along with measures of political preferences and social cleavages from parliamentary elections. We demonstrate that high wealth inequality correlated with increased vote shares for German nationalists. To address possible endogeneity concerns, we employ an instrumental variable approach based on the pre-WWI significance of land in the wealth portfolio across the wealth distribution. We interpret the results within the framework of two-issue political competition where class and ethnic divisions intersect. We hypothesise that the wealthy elites supported nationalists to counter socialist demands.

Co-Authors: Paolo Ghinetti, Simone Moriconi, Costanza Naguib, Michele Pellizzar

We study the choice of acquiring STEM and non-STEM college education using variation induced by the proximity to universities offering different types of programs. We adopt a novel methodology allowing the identification of the distribution of response types and treatment effects in a multiple unordered discrete choice setting (Heckman and Pinto, 2018). The empirical analysis is based on confidential survey data for Italy, combined with administrative information about the founding dates of all Italian universities and faculties. We find that most compliers are women at the margin of choosing STEM education versus not going to college. We simulate the effects of expanding the supply of STEM education and discover that, in addition to substantial effects on employment, the gender disparity in STEM education could potentially decrease by up to 20%.

This paper examines the long-term impacts of early childhood pollution exposure by exploiting the sharp decrease in acid rain in Norway after the enactment of the Convention on Long-Range Transboundary Air Pollution. We combine a difference-in-differences and a movers' design to analyze the outcomes between cohorts born in municipalities before and after a significant decrease in pollution exposure relative to those same cohorts born in municipalities with little initial exposure. Our findings indicate that higher pollution levels are linked to lower academic performance, with children being most vulnerable to pollution exposure during early childhood.

Co-Authors: Daniel Fernandez and Caue Dobbin

We challenge the prevailing view that the negative correlation between firm quality and separation rates is driven by efficient separations, with no distinction between quits and layoffs. Using administrative data from Brazil, we show that this correlation is primarily driven by lower layoff rates at high-quality firms, rather than differences in quits. To explain this pattern, we develop a parsimonious job search model that incorporates wage rigidity and productivity uncertainty, which interact to generate inefficient layoffs that decline with firm quality. We then introduce a novel metric of wage rigidity—based on the ratio of contracted to variable pay—and empirically validate the mechanism proposed by our theoretical framework. Our findings contribute to the growing evidence that inefficient separations play a central role in shaping labor market outcomes.

Co-Authors: Alejandra Campos (Columbia), Yyannu Cruz-Aguayo (IADB), Carolina Echeverri (University of Minnesota), Norbert Schady (World Bank)

The quality of the interaction between a teacher and her students can be assessed through classroom observations, in which observers measure the extent to which a teacher engages in classroom behaviors that educators and educational psychologists believe to be conducive to learning. Using an experiment where i) students are randomly assigned to different teachers in each year of elementary school, ii) students are tested annually in math, language and executive function (EF), and iii) teachers are filmed for a day (from which the quality of their classroom interactions can be measured), we estimate the impact of being sequentially exposed to different levels of quality of interactions during the first 5 years of schooling. We show that: 1) teachers’ quality, as assessed by the quality of interactions with students, impacts their students’ achievement not only in math, language, but also in EF; 2) these impacts are small but persistent; 3) impacts are similar across grades; 4) teacher quality is perfectly substitutable across grades.