PARENTS' WORK HOURS AND CHILDCARE DECISIONS: EXPLOITING A TIME WINDFALL.

We model the conditions under which parents optimally reallocate time to childcare when an outside agent exogenously restricts the number of hours an employer can demand of a working parent. Theoretically, when the restriction binds, a parent's available time increases. We exploit a series of voluntary and mandated labor-market reforms in South Korea that regulated the statutory and maximum work hours of parents. The government implemented the laws in stages by industry and size of firms. This implementation process generates exogenous variation across families where one or both partners worked at jobs that were or were not affected by the reform. We show the reforms affected work hours and use the predicted changes to investigate the total amount they spent on paid childcare and whether or not they changed the relative use of market and parental care. When fathers get more time (work less), parents spend less money on childcare. A change in mother's work time does not affect expenditures. When parents get more time, they are more likely to spend money on paid childcare for school-age children and more likely to use private academies.

Understanding the correlation between Alzheimer's Disease polygenic risk, wealth, and the composition of wealth holdings.

We investigate how the genetic risk of developing Alzheimer's Disease (AD) relates to saving behavior. Using nationally representative data from the 1996-2014 Health and Retirement Study (HRS), we find that genetic predisposition for AD correlates with, but is not causally related to how older individuals' hold wealth in different asset types. People with a higher AD polygenic risk score (PGS) hold roughly 20 per cent less wealth in IRAs and contribute about 24 percent less to IRAs between survey periods. We hypothesize that people with a high risk of AD choose different portfolios: (i) because they know their genetic risk of developing AD from parental history, (ii) because they have the lower cognitive capacity, and (iii) because they indirectly learn about their genetic predisposition for AD as they age. Our extended model results show that the first two hypotheses do not account for the observed correlation. Consistent with the third hypothesis, the interaction between age and the AD PGS accounts for the correlation between genetic traits and asset holdings. Our findings have far-reaching implications for researchers using genetic data: when indirect learning about own predispositions is possible, correlations between genes and choices must be interpreted with caution.

Health information and life-course smoking behavior: evidence from Turkey.

We investigate whether individuals are less likely to start and more likely to quit smoking in years when newspapers publish more articles about the health risks of smoking. With data from 9030 respondents to the 2008 Global Adult Tobacco Survey in Turkey, we construct respondents' life-course smoking histories back to 1925 and model initiation and cessation decisions taken 1925-2008. To measure information, we count articles published in Milliyet, one of Turkey's major newspapers. Results from linear probability models show that people who have seen more smoking-health risk articles know more about the smoking-health relationship. Holding constant each individual's information stock, education, place of residence, and the price of cigarettes, we find that, as new information arrives, male and female smokers in all cohorts are significantly more likely to quit and women are less likely to start. Our analysis is one of the first that examines how new information affects smoking decisions while controlling for each individual's existing stock of information.

Television and Magazine Alcohol Advertising: Exposure and Trends by Sex and Age.

OBJECTIVE: The purpose of this study was to document exposure to alcohol advertising by sex, age, and the level and type of alcohol people consume. METHOD: We use unique marketing survey data that link the media individuals consume and advertising appearing in those media. Our sample of 306,451 men and women represents the population age 18 and older living in the 48 contiguous United States between 1996 and 2009. We measure advertising exposure not with the standard expenditure data but with counts of actual advertisements people likely saw. We relate advertising exposure across groups defined by age, gender, and the amount of beer, wine, and spirits consumed. RESULTS: We found that drinkers, particularly young male drinkers, see much more alcohol advertising. Men, especially younger men, see more advertisements for alcohol of all types than do women. Their higher exposure is largely explained by sex differences in the propensity to read sports and adult magazines and to watch sports and gambling television programs. CONCLUSIONS: The evidence highlights the need to recognize, and when possible, control for the fact that a selected group of individuals is more likely to see alcohol advertising. Firms successfully place advertising on programs and in magazines viewed by youth and drinkers. To estimate whether seeing advertising causes people to drink (more), researchers need to develop clever identification strategies.

A Novel Indicator of Life-Course Smoking Prevalence in the United States Combining Popularity, Duration, Quantity, and Quality of Smoking.

OBJECTIVES: To develop a smoking indicator that combines the popularity and duration of smoking and the quantity and quality of consumed cigarettes, factors that vary dramatically over time and across generations. METHODS: We used retrospective reports on smoking behavior and a time series of cigarette tar yields to standardize nationally representative life-course smoking prevalence rates of 11 generations of US men and women, spanning 120 years. For each generation and gender, we related the standardized data with the corresponding rates of smoking-attributable mortality. RESULTS: Our indicator suggests that US cigarette consumption spread, peaked, and contracted faster than commonly perceived; predicts a significantly stronger smoking-mortality correlation than unadjusted smoking prevalence; and reveals the emergence of a delay (by up to 8 years) in premature death from smoking that is consistent with increasing population access to effective treatments. In fact, we show that, among recent cohorts, smoking health-risk exposure is at a historic low and will account for less than 5% of deaths. CONCLUSIONS: Relative to unstandardized measures, our novel, standardized indicator of smoking prevalence describes a different history of smoking diffusion in the United States, and more strongly predicts later-life mortality.

Is Smoking Behavior Culturally Determined? Evidence from British Immigrants.

We exploit migration patterns from the UK to Australia and the US to investigate whether a person's decision to smoke is determined by culture. For each country, we use retrospective data to describe individual smoking trajectories over the life-course. For the UK, we use these trajectories to measure culture by cohort and cohort-age, and more accurately relative to the extant literature. Our proxy predicts smoking participation of second-generation British immigrants but not that of non-British immigrants and natives. Researchers can apply our strategy to estimate culture effects on other outcomes when retrospective or longitudinal data are available.

Does early-life income inequality predict self-reported health in later life? Evidence from the United States.

We investigate the association between adult health and the income inequality they experienced as children up to 80 years earlier. Our inequality data track shares of national income held by top percentiles from 1913 to 2009. We average those data over the same early-life years and merge them to individual data from the Panel Study of Income Dynamics data for 1984-2009. Controlling for demographic and economic factors, we find both men and women are statistically more likely to report poorer health if income was more unequally distributed during the first years of their lives. The association is robust to alternative specifications of income inequality and time trends and remains significant even when we control for differences in overall childhood health. Our results constitute prima facie evidence that adults' health may be adversely affected by the income inequality they experienced as children.

Smoking initiation and the iron law of demand.

We show, with three longitudinal datasets, that cigarette taxes and prices affect smoking initiation decisions. Evidence from longitudinal studies is mixed but generally find that initiation does not vary with price or tax. We show that the lack of statistical significance partly results because of limited policy variation in the time periods studied, truncated behavioral windows, or mis-assignment of price and tax rates in retrospective data (which occurs when one has no information about respondents' prior state or region of residence). Our findings highlight issues relevant to initiation behavior generally, particularly those for which individuals' responses to policy changes may be noisy or small in magnitude.

Smoking behavior of Mexicans: patterns by birth-cohort, gender, and education.

OBJECTIVES: Little is known about historical smoking patterns in Mexico. Policy makers must rely on imprecise predictions of human or fiscal burdens from smoking-related diseases. In this paper we document intergenerational patterns of smoking, project them for future cohorts, and discuss those patterns in the context of Mexico's impressive economic growth. METHODS: We use retrospectively collected information to generate life-course smoking prevalence rates of five birth-cohorts, by gender and education. With dynamic panel data methods, we regress smoking rates on indicators of economic development. RESULTS: Smoking is most prevalent among men and the highly educated. Smoking rates peaked in the 1980s and have since decreased, slowly on average, and fastest among the highly educated. Development significantly contributed to this decline; a 1 % increase in development is associated with an average decline in smoking prevalence of 0.02 and 0.07 percentage points for women and men, respectively. CONCLUSION: Mexico's development may have triggered forces that decrease smoking, such as the spread of health information. Although smoking rates are falling, projections suggest that they will be persistently high for several future generations.

Just passing through: the effect of the Master Settlement Agreement on estimated cigarette tax price pass-through.

In 1998, cigarette manufacturers and state attorneys general in the United States settled a group of lawsuits in an agreement known as the Master Settlement Agreement (MSA). Among the provisions of this agreement were a set of mandated escrow payments to the states that would be based on cigarette sales. The result of these provisions is that the apparent relationship between taxes and prices changed substantially following implementation of the MSA. This article estimates whether the MSA escrow amounts are reflected in prices and compares the pass-through rate of state and federal cigarette taxes only and the rate when one adds escrow payments. We find much different pass-through rates for the two measures. State and federal taxes are not fully passed to smokers. In years that escrow payments were made, cigarette prices increased by more than the sum of the state and federal taxes and the escrow payments.

Accounting for heaping in retrospectively reported event data - a mixture-model approach.

When event data are retrospectively reported, more temporally distal events tend to get 'heaped' on even multiples of reporting units. Heaping may introduce a type of attenuation bias because it causes researchers to mismatch time-varying right-hand side variables. We develop a model-based approach to estimate the extent of heaping in the data and how it affects regression parameter estimates. We use smoking cessation data as a motivating example, but our method is general. It facilitates the use of retrospective data from the multitude of cross-sectional and longitudinal studies worldwide that collect and potentially could collect event data.

Dying for a smoke: how much does differential mortality of smokers affect estimated life-course smoking prevalence?

OBJECTIVE: An extensive literature uses reconstructed historical smoking rates by birth-cohort to inform anti-smoking policies. This paper examines whether and how these rates change when one adjusts for differential mortality of smokers and non-smokers. METHODS: Using retrospectively reported data from the US (Panel Study of Income Dynamics, 1986, 1999, 2001, 2003, 2005), the UK (British Household Panel Survey, 1999, 2002), and Russia (Russian Longitudinal Monitoring Study, 2000), we generate life-course smoking prevalence rates by age-cohort. With cause-specific death rates from secondary sources and an improved method, we correct for differential mortality, and we test whether adjusted and unadjusted rates statistically differ. With US data (National Health Interview Survey, 1967-2004), we also compare contemporaneously measured smoking prevalence rates with the equivalent rates from retrospective data. RESULTS: We find that differential mortality matters only for men. For Russian men over age 70 and US and UK men over age 80 unadjusted smoking prevalence understates the true prevalence. The results using retrospective and contemporaneous data are similar. CONCLUSIONS: Differential mortality bias affects our understanding of smoking habits of old cohorts and, therefore, of inter-generational patterns of smoking. Unless one focuses on the young, policy recommendations based on unadjusted smoking rates may be misleading.

An analysis of life-course smoking behavior in China.

With a total population of more than 1.3 billion people where more than 31% of adults smoke, China has become the world's largest producer and consumer of cigarettes. We adopt a life-course perspective to study the economics of smoking behavior in China. We use data from the China Health and Nutrition Survey (CHNS) to follow individuals over their whole lives and to analyze their decisions to both start and stop smoking. We extend the small but growing body of economic research on smoking in China. Our life-course approach emphasizes that current smoking participation reflects a decision to start and a series of past decisions to not quit. We explore how the determinants of smoking initiation differ from the determinants of smoking cessation. We find results, consistent with some previous empirical evidence, that Chinese smoking is not strongly related to the price of cigarettes. Based on our results, we offer some speculative hypotheses that, we hope, might guide future research on the economics of smoking in China. It seems especially useful to compare the broad patterns we document with the experiences of other countries.

Who kicks the habit and how they do it: socioeconomic differences across methods of quitting smoking in the USA.

Although the prevalence of smoking has declined among US adults, an estimated 22.5% of the adult population (45.8 million adults) regularly smoked in 2002. Starting from this level, it will not be possible to achieve the Healthy People national health objectives of a reduction in the prevalence of smoking among adults to less than 12% by 2010 unless the rate of smoking cessation substantially rises from its current average of about 2.5%/year. To achieve that goal it is imperative that we better understand what factors are associated with successful quitting so that policies and resources can be better targeted. We describe the socioeconomic characteristics of smokers who attempt to and successfully quit and show how those characteristics differ across three methods they use in their cessation behavior. The results highlight socioeconomic differences across the methods smokers use and provide evidence that can be used to better target smoking cessation information and resources to smokers most likely to use particular methods. Better targeting is likely to lead to more quits. While it is unlikely that cessation rates can be raised by enough to achieve the reduction in national smoking prevalence that the Healthy People initiative has set, a better understanding of who chooses which method will move us closer to that goal.

Until death do us part: an analysis of the economic well-being of widows in four countries.

OBJECTIVE: Our objective was to show how a woman's economic well-being changes in the United States, Germany, Great Britain, and Canada after her husband's death and the importance of public and private income sources in offsetting the economic consequences of that death. METHODS: With data from the Cross-National Equivalent File, we used event history analysis to track changes in the social security replacement rate and the more comprehensive total income replacement rate for women and to show how these changes vary across age and household income quintiles within and across countries. RESULTS: There were substantial differences across the countries in how income from specific sources changes, especially with respect to the mix of income from government and private sources, but the overall across-country pattern of total income replacement rates was remarkably similar both in size and in distribution across age and the woman's place in the income distribution prior to her husband's death. DISCUSSION: Studies that focus on a social security replacement rate will seriously understate the actual total income replacement rate of women following a husband's death. This will especially be the case in countries like the United States where private sources of income play a more important role in income replacement.

Coupons and advertising in markets for addictive goods: do cigarette manufacturers react to known future tax increases?

We develop and test a pricing model for a monopolist that sells an addictive good. The model illustrates the conditions under which a monopolist lowers the price he charges youth when a future tax is imposed. Using household survey data, we investigate whether individuals use "cents-off" coupons in a way consistent with the price discrimination implied by the model. We find evidence that all smokers, not just the young, are more likely to use coupons prior to a tax increase if they are exposed to more advertising. With our data we cannot test whether cigarette manufacturers selectively offer youth price discounts in other ways.

Accounting for misclassification error in retrospective smoking data.

Recent waves of major longitudinal surveys in the US and other countries include retrospective questions about the timing of smoking initiation and cessation, creating a potentially important but under-utilized source of information on smoking behavior over the life course. In this paper, we explore the extent of, consequences of, and possible solutions to misclassification errors in models of smoking participation that use data generated from retrospective reports. In our empirical work, we exploit the fact that the National Longitudinal Survey of Youth 1979 provides both contemporaneous and retrospective information about smoking status in certain years. We compare the results from four sets of models of smoking participation. The first set of results are from baseline probit models of smoking participation from contemporaneously reported information. The second set of results are from models that are identical except that the dependent variable is based on retrospective information. The last two sets of results are from models that take a parametric approach to account for a simple form of misclassification error. Our preliminary results suggest that accounting for misclassification error is important. However, the adjusted maximum likelihood estimation approach to account for misclassification does not always perform as expected.