Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5098707 | Journal of Economic Dynamics and Control | 2013 | 19 Pages |
Abstract
Motivated by the empirical fact that parents with more human capital spend more time teaching and taking care of their children, we develop and estimate a theoretical model in which altruistic parents pass their human capital on in two ways: goods investment and time investment. Based on the estimated model, we quantitatively assess how the two types of investment affect wage inequality and inter-generational mobility. Using the model to study the impacts of a public policy that taxes income to finance public schooling, we find significantly different policy effects in our model than in a model where time investment does not respond endogenously to the policy.
Related Topics
Physical Sciences and Engineering
Mathematics
Control and Optimization
Authors
Guozhong Zhu, Gulfer Vural,