Working Paper: CEPR ID: DP9483
Authors: Alberto F. Alesina; Paola Giuliano
Abstract: We study the role of the most primitive institution in society: the family. Its organization and relationship between generations shape values formation, economic outcomes and influences national institutions. We use a measure of family ties, constructed from the World Values Survey, to review and extend the literature on the effect of family ties on economic behavior and economic attitudes. We show that strong family ties are negatively correlated with generalized trust; they imply more household production and less participation in the labor market of women, young adult and elderly. They are correlated with lower interest and participation in political activities and prefer labor market regulation and welfare systems based upon the family rather than the market or the government. Strong family ties may interfere with activities leading to faster growth, but they may provide relief from stress, support to family members and increased wellbeing. We argue that the value regarding the strength of family relationships are very persistent over time, more so than institutions like labor market regulation or welfare systems.
Keywords: Cultural Economics; Family Values; Growth; Institutions; Labor Market Regulations
JEL Codes: J2; J6; O4; O5; Z1
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| strong family ties (J12) | decreased labor market participation among women, young adults, and the elderly (J21) |
| strong family ties (J12) | increased household production (D13) |
| strong family ties (J12) | lower political participation (D72) |
| strong family ties (J12) | preference for labor market regulations favoring familial support (J48) |
| strong family ties (J12) | lower GDP per capita (O54) |
| strong family ties (J12) | lower quality of institutions (O17) |
| family values inherited by children of immigrants (J12) | poorer institutional quality today (O17) |