Working Paper: NBER ID: w13051
Authors: Alberto Alesina; Paola Giuliano
Abstract: The structure of family relationships influences economic behavior and attitudes. We define our measure of family ties using individual responses from the World Value Survey regarding the role of the family and the love and respect that children need to have for their parents for over 70 countries. We show that strong family ties imply more reliance on the family as an economic unit which provides goods and services and less on the market and on the government for social insurance. With strong family ties home production is higher, labor force participation of women and youngsters, and geographical mobility, lower. Families are larger (higher fertility and higher family size) with strong family ties, which is consistent with the idea of the family as an important economic unit. We present evidence on cross country regressions. To assess causality we look at the behavior of second generation immigrants in the US and we employ a variable based on the grammatical rule of pronoun drop as an instrument for family ties. Our results overall indicate a significant influence of the strength of family ties on economic outcomes.
Keywords: family ties; economic behavior; cultural values; social insurance; labor force participation
JEL Codes: H20; J01
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| strong family ties (J12) | increased home production (D13) |
| strong family ties (J12) | decreased market participation (F61) |
| moving from strong to weak family ties (J12) | increase female labor force participation (J21) |
| moving from strong to weak family ties (J12) | increase youth participation (J13) |
| strong family ties (J12) | higher fertility rates (J13) |
| strong family ties (J12) | larger family sizes (J12) |
| strong family ties (J12) | higher happiness (I31) |
| strong family ties (J12) | reduced reliance on government support (H53) |