The case for making public policy evaluations public

This brief sets out the case for making public policy evaluations public. It first reviews the various challenges associated with impact evaluations, paying particular attention to the unique hurdles involved in evaluating Indigenous policy. Lessons learned from clinical trials registries in medical research are then used to argue that Australian economic and social policy evaluations could be improved by making them public

“High”-school: the relationship between early marijuana use and educational outcomes

Abstract: We use unique survey data linked to nearly a decade of administrative welfare data to examine the relationship between early marijuana use (at age 14 or younger) and young people’s educational outcomes. We find evidence that early marijuana use is related to educational penalties that are compounded by high-intensity use and are larger for young people living in families with a history of welfare receipt. The relationships between marijuana use and both high school completion and achieving a university entrance score appear to stem from selectivity into the use of marijuana. In contrast, early marijuana use is associated with significantly lower university entrance score for those who obtain one and we provide evidence that this effect is unlikely to be driven by selection. Collectively, these findings point to a more nuanced view of the relationship between adolescent marijuana use and educational outcomes than is suggested by the existing literature. Authored by Deborah A. Cobb-Clark, Sonja C. Kassenboehmer, Trinh Le, Duncan McVicar and Rong Zhang

Leaving Home: What Economics Has to Say about the Living Arrangements of Young Australians

Like their counterparts elsewhere, more young Australians than ever are delaying the move to establish residential independence from their parents. This paper reviews the developing economics literature surrounding young people’s decisions to continue living in their parents’ homes in order to begin to assess the causes and consequences of this decision. In particular, co-residence with parents appears to be an important form of intergenerational support for young adults. It is important to understand the extent to which young people rely on this form of support as they complete their education, enter the labour market, and establish themselves as independent adults. Specific attention is paid to the ways in which Australian income-support, education, and housing policies may influence these patterns.Economics of the family, Household decision-making

Noncognitive Skills, Occupational Attainment, and Relative Wages

This paper examines whether men's and women's noncognitive skills influence their occupational attainment and, if so, whether this contributes to the disparity in their relative wages. We find that noncognitive skills have a substantial effect on the probability of employment in many, though not all, occupations in ways that differ by gender. Consequently, men and women with similar noncognitive skills enter occupations at very different rates. Women, however, have lower wages on average not because they work in different occupations than men do, but rather because they earn less than their male colleagues employed in the same occupation. On balance, women's noncognitive skills give them a slight wage advantage. Finally, we find that accounting for the endogeneity of occupational attainment more than halves the proportion of the overall gender wage gap that is unexplained.noncognitve skills, personality, occupation, gender wage gap, decomposition

The Sexual Harassment of Female Active-Duty Personnel: Effects on Job Satisfaction and Intentions to Remain in the Military

This paper examines the relationship between sexual harassment and the job satisfaction and intended turnover of active-duty women in the U.S. military using unique data from a survey of the incidence of unwanted gender-related behavior conducted by the U.S. Department of Defense. Overall, 70.9 percent of active-duty women reported experiencing some type of sexually harassing behavior in the 12 months prior to the survey. Using single-equation probit models, we find that experiencing a sexually harassing behavior is associated with reduced job satisfaction and heightened intentions to leave the military. However, bivariate probit results indicate that failing to control for unobserved personality traits causes single-equation estimates of the effect of the sexually harassing behavior to be overstated. Similarly, including women’s views about whether or not they have in fact been sexually harassed directly into the single equation model reduces the estimated effect of the sexually harassing behavior itself on job satisfaction by almost a half while virtually eliminating it for intentions to leave the military. Finally, women who view their experiences as sexual harassment suffer additional negative consequences over and above those associated with the behavior itself.job satisfaction; sexual harassment; military employment

Do Coresidency with and Financial Transfers from Children Reduce the Need for Elderly Parents to Work in Developing Countries?

What drives the labor supply decisions of the elderly in developing countries? To what extent do elderly parents use coresidence with or financial transfers from children to reduce their own labor supply in old age? These questions are increasingly important because populations in many developing countries are rapidly aging. A clear understanding of the relationships between different means of support in old age is crucial to the development of sensible policy responses. This paper is one of only a few studies that seeks to formally model elderly labor supply in the context of a developing country while taking into account coresidency with and financial transfers from children. We find little evidence that support from children – either through transfers or coresidency – substitutes for elderly parents’ need to work. Thus, as in developed countries, there is a role for public policy to enhance the welfare of the elderly population.Intergenerational transfers, Old-age support, Elderly labor supply

The Wealth of Mexican Americans

This paper analyzes the sources of disparities in the relative wealth position of Mexican Americans. Results reveal that wealth gaps are in large part not the result of differences in conditional expected wealth functions. Similarly, income differentials are important, but do not play the primary role in explaining the gap in median net worth. As much or more of Mexican Americans' wealth disadvantage is attributable to the fact that these families have more young children and heads who are younger. Furthermore, Mexican Americans' low educational attainment has a direct effect in producing a wealth gap relative to other ethnic groups (even after differences in income are taken into account) though education does not significantly affect the nativity wealth gap. Finally, geographic concentration is generally unimportant, but does contribute to narrowing the wealth gap between wealthy Mexican Americans and their white and black counterparts.wealth; Mexican American

The Retirement Expectations of Middle-Aged Individuals

We use the first three waves of the Household Income and Labour Dynamics in Australia (HILDA) Survey to examine the retirement plans of middle-aged workers (aged 45-55). Our results indicate that approximately two-thirds of men and more then half of women appear to be making standard retirement plans. At the same time, more than one in five individuals seem to have delayed their retirement planning and approximately one in ten either do not know when they expect to retire or expect to never retire. Retirement plans are closely related to current labor market position. Specifically, forming expectations about the age at which one will leave the labor market appears to be easier for workers in jobs with well defined pension benefits and standard retirement ages. Moreover, those who report that they do not know when they expect to retire do in fact appear to face greater uncertainty in their retirement planning. Those who anticipate working forever seem to do so out of concerns about the adequacy of their retirement incomes rather than out of increased job satisfaction or a heightened desire to remain employed. Finally, men alter their retirement plans in response to labor market shocks, while women are more sensitive to their own and their partners’ health changes.retirement, expectations, middle-aged workers

Two Economists’ Musings on the Stability of Locus of Control

Empirical studies of the role of non-cognitive skills in driving economic behavior often rely heavily on the assumption that these skills are stable over the relevant time frame. We analyze the change in a specific non-cognitive skill, i.e. locus of control, in order to directly assess the validity of this assumption. We find that short- and medium-run changes in locus of control are rather modest on average, are concentrated among the young or very old, do not appear to be related to the demographic, labor market, and health events that individuals experience, and are unlikely to be economically meaningful. Still, there is no evidence that locus of control is truly time-invariant implying that the use of lagged measures results in an errors-in-variables problem that could downward bias the estimated wage return to locus of control by as much as 50 percent. Those researchers wishing to analyze the economic consequences of non-cognitive skills should consider (i) restricting their analysis to the working-age population for whom there is little evidence of systematic change in skill levels and (ii) accounting for error in the skill measures they employ.non-cognitive skills, locus of control, stability, measurement error, endogeneity, life events

Neighborhood Diversity and the Appreciation of Native- and Immigrant-Owned Homes

This paper examines the effect of neighborhood diversity on the nativity gap in home-value appreciation in Australia. Specifically, immigrant homeowners experienced a 41.7 percent increase in median home values between 2001 and 2006, while the median value of housing owned by the native-born increased by 59.4 percent over the same period. We use a semi-parametric decomposition approach to assess the relative importance of the various determinants of home values in producing this gap. We find that the differential returns to housing wealth are not related to changes in the nature of the houses or the neighborhoods in which immigrants and native-born homeowners live. Rather, the gap stems from the fact that over time there were differential changes across groups in the hedonic prices (i.e., returns) associated with the underlying determinants of home values.international migration, home-ownership, decomposition analysis