Working papers
“Marriage and Work Among Prime Age Men”, with Adam Blandin and John Jones, Federal Reserve Bank of Dallas Working Paper No. 23-13
[Abstract]: Married men work substantially more hours than men who have never been married, even after controlling for observables. Panel data reveal that much of this gap is attributable to an increase in work in the years leading up to marriage. Two potential explanations for this increase are: (i) men hit by positive labor market shocks are more likely to marry; and (ii) the prospect of marriage increases men's labor supply. We quantify the relative importance of these two channels using a structural life-cycle model of marriage and labor supply. Our calibration implies that marriage substantially increases male labor supply. Counterfactual simulations suggest that if men were unable to marry, prime-age male work hours would fall by 7%, and if marriage rates fell to the extent observed, men born around 1980 would work 2% fewer hours than men born around 1960.
Consumption and Hours between U.S. and France, with Lei Fang, Federal Reserve Bank of Atlanta Working Paper No. 2021-7
[Abstract]: We document large differences between the United States and France in allocations of consumption expenditures and time by age. Using a life-cycle model, we quantify to what extent tax and transfer programs and market and home productivity can account for the differences. We find that while labor efficiency by age and home-production productivity are crucial in accounting for the differences in the allocation of time, the consumption tax and social security are more important regarding allocation of expenditures. Adopting the US consumption tax decreases welfare in France, and adopting the US social security system increases welfare in France.
“Why Do Households Save and Work?”, with Margherita Borella, Mariacristina De Nardi, Johanna Torres Chain. NBER Working Paper 33874, Federal Reserve Bank of Dallas Working Paper No. 2526
[Abstract]:This paper develops and estimates a dynamic life-cycle model to quantify why households save and work. The model incorporates multiple sources of risk—health, marital status, wages, medical expenses, and mortality—as well as endogenous labor supply and human capital accumulation, retirement, and bequest motives at the death of the first and last household member. We estimate it using PSID and HRS data for the 1941–1945 cohort via the Method of Simulated Moments. Eliminating bequest motives reduces aggregate wealth by 23.8% and labor earnings by 1.2%; removing medical expenses lowers them by 13.1% and 0.7%. Wage risk is crucial for early-life saving: its removal reduces wealth by 10.4% but raises earnings by 2.3%. Eliminating marriage and divorce dynamics leads couples—numerous and wealthier—to save and work slightly less, and singles—fewer and poorer—to save and work considerably more. These effects largely offset in the aggregate. Removing all saving motives beyond retirement needs and lifespan uncertainty lowers wealth by 56.9% and earnings by 2.7%. These findings show that capturing multiple risks and behavioral margins jointly is essential to understanding household saving and labor supply.
"Household Consumption and Savings over the Life Cycle: The Roles of Demographics and Durables", with Neha Bairoliya, Areendam Chanda, Jingyi Fang, Dallas Fed Working Paper No. 2537
[Abstract]: The canonical prediction of life-cycle models, that individuals smooth consumption over their lifetime, has been mostly tested for developed countries and found little empirical support. We provide a novel, developing country perspective by analyzing patterns of life-cycle consumption, income, and savings rates in India. In contrast to the U.S., Indian households exhibit no growth in nondurable consumption expenditures after adjusting for family size. We present evidence that saving for lumpy investments in consumer durables is a key driver of high savings rates and flat nondurable consumption over the life cycle in India.
Work in Progress
“The Evolution of Urban - Rural Income and Consumption Inequality in Transitioning China”, with Dan Yang
“Demographics, Labor Mobility, and Pension Sustainability: Evidence from China,” with Suqin Ge, Chunzan Wu, and Junsen Zhang
“Social Security Redistribution and Female Labor Supply”, with Margherita Borella and Mariacristina De Nardi
“Estate Taxation in An Aging Economy”, with Selahattin Imrohoroglu
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