Giacomo Pasini

Household Debt and Social Interactions

Debt-induced crises, including the subprime crisis, are usually attributed exclusively to supply-side factors. We examine the role of social influences on debt culture, emanating from perceived average income of peers. Utilizing unique information from a household survey, representative of the Dutch population, that circumvents the issue of defining the social circle, we consider collateralized, consumer, and informal loans. We find robust social effects on borrowing - especially among those who consider themselves poorer than their peers - and on indebtedness, suggesting a link to financial distress. We employ a number of approaches to rule out spurious associations and to handle correlated effects.

The long-run effect of maternity leave benefits on mental health: Evidence from European countries

This paper examines whether maternity leave policies have an effect on womens mental health in older age. We link data for women aged 50 years and above from countries in the Survey of Health, Ageing and Retirement in Europe (SHARE) to data on maternity leave legislation from 1960 onwards. We use a difference-in-differences approach that exploits changes over time within countries in the duration and compensation of maternity leave benefits, linked to the year women were giving birth to their first child at age 16 to 25. We compare late-life depressive symptom scores (measured with a 12-item version of the Euro-D scale) of mothers who were in employment in the period around the birth of their first child to depression scores of mothers who were not in employment in the period surrounding the birth of a first child, and therefore did not benefit directly from maternity leave benefits. Our findings suggest that a more generous maternity leave during the birth of a first child is associated with a reduced score of 0.38 points in the Euro-D depressive symptom scale in old age.

The direct impact of maternity benefits on leave taking: Evidence from complete fertility histories.

Maternity leave policies have important effects on several labour market outcomes of women, and are specifically designed to reduce gender differences in the various dimensions of working life and to contrast the negative consequence of fertility decisions. By making use of a unique data set which contains complete work and fertility histories for different European countries, combined with features of maternity leave schemes across countries and over time, we look at the effect of maternity leave benefits on job interruptions after each successive childbirth. The main result of the paper is that maternity leave legislation in Europe effectively increases job protection and female labour market attachment: a more generous paid maternity leave increases the number of weeks employed but not at work, but reduces the number of weeks spent out of the labour market.

The Influence of Affective Reactions on Investment Decisions

The present research aims to show how investors’ affective reactions toward a fund influence their decision to sell the investment. Participants were presented with either a socially responsible or a traditional fund. After completing a mental images task, participants were asked to state the price at which they were willing to sell the fund and their confidence in future positive performance. Participants were willing to sell the fund at different prices depending on their affective reactions. The affective reactions also influenced participants’ confidence. Furthermore, we found that the socially responsible fund induced a more positive reaction than the ordinary fund.

Social capital and health across European countries

In this article we compare the effect of trust and civic participation on self-assessed health across 10 European countries. We find that, after controlling for a rich set of socio-economic characteristics, for actual health status and for health-related behaviours, trust has a significantly positive effect on perceived health in Sweden and Germany, but none in the other countries. Civic participation does have a positive and quite similar effect in all countries. Our conclusion is that they measure two different aspects of social capital that must be treated separately.

The informational divide

We propose a model of price competition where consumers exogenously differ in the number of prices they compare. Our model can be interpreted either as a non-sequential search model or as a network model of price competition. We show that (i) if consumers who previously just sampled one firm start to compare more prices all types of consumers will expect to pay a lower price and (ii) if consumers who already sampled more than one price sample (even) more prices then there exists a threshold – the informational divide – such that all consumers comparing fewer prices than this threshold will expect to pay a higher price whereas all consumers comparing more prices will expect to pay a lower price than before. Thus increased search can create a negative externality and it is not necessarily beneficial for all consumers.

Home Care for the Elderly: Family, Friends, and the State

This paper uses data from the Survey of Health, Ageing and Retirement in Europe to examine the home care received by elderly in Western Europe. Specifically, we relate the demand for home care to the health status of the elderly household members and like previous studies find that health limitations, age, and marital status are important determinants of home care. New findings come from a detailed analysis of the relative demand from different potential home care providers (children, other relatives, friends and the state). The results reveal that relatives and friends provide as much home care as children and that the relative importance of the different home care providers changes with household characteristics like age and total health care demand. Furthermore, the results show that friends act as a substitute for informal care from adult children.

Long-term care and reciprocity: does helping with grandchildren result in the receipt of more help at older ages?

This paper investigates the presence of reciprocity in informal care provision among European families. Using data from the first two waves of SHARE (the Survey of Health, Retirement and Ageing) we empirically analyze whether the provision of informal childcare by grandparents at some point in time has an impact on the prevalence and intensity of informal care they will later receive, once needing care to perform activities of daily living, from adult children. Results show that the prevalence of informal care receipt is significantly higher for grandparents who previously provided childcare, while no effect is registered for the amount of care received. Aknowledgments: We are grateful to Howie Litwin and participants to the Brixen SHARE meeting 2012 for helpful comments. This paper uses data from SHARE release 2.5.0, as of May 24th 2011. The SHARE data collection has been primarily funded by the European Commission through the 5th framework programme (project QLK6-CT-200100360 in the thematic programme Quality of Life), through the 6th framework programme (projects SHARE-I3, RII-CT2006-062193, COMPARE, CIT5-CT-2005-028857, and SHARELIFE, CIT4-CT-2006-028812) and through the 7th framework programme (SHARE-PREP, 211909 and SHARE-LEAP, 227822). Additional funding from the U.S. National Institute on Aging (U01 AG09740-13S2, P01 AG005842, P01 AG08291, P30 AG12815, Y1-AG-4553-01 and OGHA 04-064, IAG BSR06-11, R21 AG025169) as well as from various national sources is gratefully acknowledged (see http://www.share-project.org for a full list of funding institutions). This research has benefited from Authors acknowledge the funding received by Farmafactoring foundation. All responsibility for the analysis and interpretation of the data presented here lies with the authors only.

Nest Leaving in Europe

The nest leaving period and the age at which individuals establish their own independent household are of primary policy concern since they are critically linked to many economic and social outcomes. The choices made by young adults are numerous: further education, marriage, parenthood, first job. All are interrelated and can be linked to another choice, that of a first independent home. Youth labour supply and educational choices will determine the length of the career, pension and life-time consumption. Billari and Tabellini (2008) show that Italians who leave the parental home earlier in life earn a higher income in their mid 30s. This might be due either to the fact that they tend to have longer working experience or to a negative impact of prolonged co-residence on ambitions and motivations for children who leave late (Alessie et al. 2006). The demographic transition and population evolution are largely linked to the timing of first parenthood. Health in later life and life expectancy are linked to the education level.

Maternity and Labour Market Outcome: Short and Long Term Effects

Retirement patterns, as well as continuity and length of work histories, are strongly influenced by the events over the life cycle. This is particularly true for women. Gender differences in work-careers and the role of women within the family usually lead to fewer pension rights and lower retirement income for women than for men. In particular, maternity is likely to be one of the major drivers of gender differences on life time economic outcomes such as labour force participation, differential productivity and wages and eventually retirement income.