The Contribution and Potential of Data Harmonization for Cross-National Comparative Research

The promise of empirical evidence to inform policy makers about their population's health, wealth, employment and economic well being has propelled governments to invest in the harmonization of country specific micro data over the last 25 years. We review the major data harmonization projects launched over this period. These projects include the Luxembourg Income Study (LIS), the Cross-National Equivalent File (CNEF), the Consortium of Household Panels for European Socio-Economic Research (CHER), the European Community Household Panel (ECHP), the European Union Statistics on Income and Living Conditions (EU-SILC), and the Survey of Health, Aging and Retirement in Europe (SHARE). We discuss their success in providing reliable data for policy analysis and how they are being used to answer policy questions. While there have been some notable failures, on the whole these harmonization efforts have proven to be of major value to the research community and to policy makers.

Private Profits and Public Health: Does Advertising Smoking Cessation Products Encourage Smokers to Quit?

To shed new light on the role private profit incentives play in promoting public health, in this paper we conduct an empirical study of the impact of pharmaceutical industry advertising on smoking cessation decisions. We link survey data on individual smokers with an archive of magazine advertisements. The rich survey data allow us to measure smokers' exposure to smoking cessation advertisements based on their magazine-reading habits. Because we observe the same information about the consumers that the advertisers observe, we can control for the potential endogeneity of advertising due to firms' targeting decisions. We find that when smokers are exposed to more advertising, they are more likely to attempt to quit and are more likely to have successfully quit. While some of the increased quitting behavior involves purchases of smoking cessation products, our results indicate that advertisements for smoking cessation products also increase the probability of quitting without the use of any product. Thus, the public health returns to smoking cessation product advertisements exceed the private returns to the manufacturers. Because advertising of a wide range of consumer products may have important and under-studied spillover effects on various non-market behaviors, our results have broad implications for the economics of advertising.

Long-term Labor Force Exit and Economic Well-being: A Cross-National Comparison of Public and Private Income Support

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How Exits from the Labor Force of Death Impact Household Incomes: A Four Country Comparison of Public and Private Income Support

Government policies attempt to mitigate the economic risks to households of major life transitions. This paper focuses on two such transitions that social security systems typically insure against—long term exits from the labor market (retirement, disability, unemployment insurance) and the death of a household head or spouse (survivor’s insurance). We examine labor force exits of men at various ages in four countries--Canada, Germany, Great Britain, and the United States—using data from the Cross-National Equivalent File, a matched longitudinal data set. We focus on how average net-of-tax household income changes in the years before and after the event. We find that when one measures the change in economic well-being following a labor market exit by the fraction of lost labor earnings replaced by social security income, the decline in the household’s economic well-being is substantially overstated. When we compare net-of-tax household income before and after a long term exit from the labor market, we find that such drops are much less than those implied by a social security replacement rate and that differences across countries in the average drop are much less than those based on a social security replacement rate. We find the same pattern when we focus on how net-of-tax household income changes in the years before and after the death of a head or spouse. Declines in net-of-tax household income following such a death are much lower than the decline implied by a replacement of the deceased person’s labor earnings and social security benefits by their household’s post-death social security income. But the size of the change in individualized net-of-tax income following the death of a head or spouse is greatly affected by assumptions used to adjust for changes in household size.

Regulating Advertisements: The Case of Smoking Cessation Products

In this paper we investigate how direct-to-consumer (DTC) advertising of pharmaceutical products in affected by regulations of the Food and Drug Administration and by market conditions. We focus on a relatively under-studied segment of the pharmaceutical market -- the market for smoking cessation products. Because of their proven effectiveness, these products could be the key to meeting public health goals to reduce smoking. However, in many ways, smoking cessation products have been more heavily regulated than cigarettes. Our empirical analysis uses data on advertising expenditures and data from an archive of print advertisements. The archive includes all smoking cessation product advertisements that appeared in over 13,000 issues of 28 magazines between January 1985 and May 2002. Our study period begins shortly atfer the first nicotine replacement product was introduced, and covers the evolution of the market as new products are introduced while some of the older products move from prescription to over-the-counter (OTC) status. OTC status eases the disclosure requirements imposed on advertisements of prescription pharmaceuticals, substantially reducing the costs of a print advertisement. Our results suggest that OTC status is associated with an increase in advertising expenditures and the number and pages of magazine advertisements. A current proposal to reduce disclosure requirements on all DTC advertisements of prescription drugs could have similar effects. Our results also suggest that advertising increase with the introduction of new products and with market competition.

Cross-National Estimates of the Intergenerational Mobility in Earnings

Abstract This paper examines the similarity in the association between earnings of sons and fathers in Germany and the United States. It relaxes the log-linear functional form imposed in most studies of the intergenerational earnings association. Theory implies the relationship between earnings of fathers and sons could be nonlinear, especially at the tails of the distribution of earnings of fathers. When a more flexible function form is fit to the data, the apparent similarity between Germany and the United States disappears. Relative to mobility in Germany, upward mobility is higher in the United States for sons with the poorest fathers and downward mobility is lower for sons with fathers with high earnings

Keeping it in the Family? If Parents Smoke Do Children Follow?

I use retrospective data on smokers from the German Socio-Economic Panel to investigate whether children are more likely to smoke if their parents smoke(d). Despite intense policy interest, researchers have not established whether the well-established (positive) association is causal. I exploit panel data observations on smoking behavior of parents and children to develop instrumental variables that identify the causal relationship between parental smoking and youth initiation. The results suggest that children are not more or less likely to start smoking if their parents smoke. Failing to control for the endogenous choice of parents to smoke leads to incorrect inferences