We discuss a simple model in which parents and children make investments in the children’s education, investments for other purposes, and parents can transfer cash to their children. We show that for an identifiable set of parent-child pairs, parents will rationally under-invest in their...

Increasingly, grade retention is viewed as an important alternative to social promotion, yet evidence to date is unable to disentangle how the effect of grade retention varies by abilities and over time. The key challenge is differential selection of students into retention across grades and by...

This paper examines the early origins of observed health disparities by education. We determine the role played by cognitive, noncognitive and early health endowments, and we identify the causal effect of education on health and health-related behaviors. We show that family background...

Using a sequential model of educational choices, we investigate the effect of educational choices on labor market, health, and social outcomes. Unobserved endowments drive the correlations in unobservables across choice and outcome equations. We proxy these endowments with numerous measurements...

A wide body of research explores gender differences in welfare outcomes, and their implications for economic development. We aim to contribute to this work by looking at differences in reported well-being (happiness) across genders around the world. We examine differences across genders within...

Objectives: Investigate how different model assumptions have driven the conflicting findings in the literature on the deterrence effect of capital punishment. Methods: The deterrence effect of capital punishment is estimated across different models that reflect the following sources of model...

We develop a model of retirement and human capital investment to study the effects of tax and retirement policies. Workers choose the supply of raw labor (career length) and also the human capital embodied in their labor. Our model explains a significant fraction of the US-Europe difference in...

Behavioral economics has shaken the view that individuals have well-defined, consistent and stable preferences. This raises a challenge for welfare economics, which takes as a key postulate that individual preferences should be respected. This paper scrutinizes the challenge and argues, in...

Experts have long believed that the high economic returns on sound early childhood programs means it should be possible to pay for such programs with so-called "invest-in-kid bonds", a form of social impact finance that would pay income and repay invested capital from the proceeds of the...

In his seminal book, The Enlightened Economy, Joel Mokyr argued that "in Britain the high quality of workmanship available to support innovation, local and imported, helped create the Industrial Revolution". By these, Mokyr refers to "the top 3-5 percent of the labor force in terms of skills:...