Mariacristina Rossi

Preschool Nutrition and Subsequent Schooling Attainment: Longitudinal Evidence from Tanzania

This study analyzes how childhood health determines future academic performance in the Kagera region in Tanzania. Academic outcomes considered are years of education and delay in enrollment, and the measure of childhood health is height (relative to the median). The repercussions of malnutrition in childhood on subsequent learning and school performance are analyzed by using a unique longitudinal data set. Results indicate the degree to which malnutrition leads to reduced lifetime earning capacity due to both delays in schooling and declines in total schooling.

Impact of School Quality on Child Labor and School Attendance: The Case of CONAFE Compensatory Education Program in Mexico

This paper focuses on the impact that two different types of policy interventions, namely enhancing school quality and contingent cash transfers, have on child labor and school attendance in Mexico. While there are many studies on the impact of oportunidades on schooling outcomes, little evidence is available on whether school quality programs such as National Council of Education Promotion (CONAFE) also reduce child labor and help keep children in school. To carry out the analysis, it merge the oportunidades panel dataset for the years 1997 to 2000 to the CONAFE dataset containing detailed information on the school quality program components. The econometric strategy involves a bivariate probit model for child labor and schooling, both for primary school aged children and adolescents. In this way, the authors are able to control whether the impact of the program on schooling differs according to the age of the targeted child. The report findings suggest that school quality programs are not only effective in increasing school attendance, but also act as deterrents to child labor, especially for children of secondary school age.

Examining the interaction between saving and contributions to Personal Pension Plans. Evidence from the BHPS

This paper analyses the effects of social security reforms on saving in Britain. We use the British Household Panel Survey to investigate the interactions between voluntary additional contributions to personal pension plans (PPP) and saving in conventional forms. In particular, we test whether contributions to the PPP crowd out saving or constitute additional saving. Results suggest that not only have private pension schemes not crowded out private saving, but actually they have increased it too.

Precautionary Saving and Health Risk: Evidence from Italian Households Using a Time Series of Cross Sections

In this paper we analyse the importance of precautionary saving in Italy. In contrast to previous studies, we focus on two contemporaneous sources of uncertainty, income and health expenditures, to explain the presence of precautionary saving. The major changes occurred in public health care policies from 1985 to 1996 have caused households to pay a larger share of their outof-the-pocket medical expenditures. We therefore expect consumers to react to this uncertainty by generating precautionary saving.Our results show strong support for the precautionary savinghypothesis as a response to health uncertainty.

The Persistence of Income Poverty and Lifestyle Deprivation: Evidence from Italy

This article estimates poverty persistence over an individuals lifetime, using two definitions: income poverty and a multidimensional index of life-style deprivation. We stressed the ability of the two definitions to provide a generally consistent characterization of poverty persistence risks faced by various population subgroups, but also the additional insights to be gained by analyzing the two definitions in parallel in a longitudinal context. The results of multiple-spell hazard rate models highlight the weaknesses of the Italian labour market, the insufficiencies of the existing social security system and the deep territorial dualism in generating persistent poverty for certain groups of the population.

Un)expected retirement and the consumption puzzle

In this work we revisit the retirement consumption puzzle using Italian panel data. As emphasized in the literature, the observed consumption drop might be due to unexpected wealth shocks at retirement, which modify optimal consumption plans. Using an Euler equation approach, we test the impact of unexpected retirement on the consumption patterns of individuals around the age of retirement by using the panel component of the Survey of Household Income and Wealth (SHIW). This data set contains information on the expected age of retirement, which can be used to distinguish between expected and unexpected retirement. We furthermore investigate the heterogeneous behaviour of individuals with different levels of education and wealth. We find evidence of a consumption drop at retirement, especially for low-educated people and individuals with low wealth. The consumption drop at retirement seems to be rationally planned by individuals, rather than a response to unexpected retirement.

Do Women Prefer Pink? The Effect of a Gender Stereotypical Stock Portfolio on Investing Decisions

We investigate whether lack of familiarity may contribute to an explanation of the gender gap in stock market participation and risk taking. We use ads in widely read women magazines to select companies that we assume to be more familiar to women than to men, and construct a “pink�? portfolio. We construct a “blue�? portfolio by selecting stocks from the AEX index. We ask members of the CentERpanel how they would allocate 100.000 euro of pension wealth. Half of respondents are given the choice between government bonds and a portfolio consisting of companies most traded at Amsterdam Exchanges, while the other half can choose between government bonds and our “pink�? portfolio. We find that significantly more women than men choose not to respond after having seen the question and that respondents tend to allocate their hypothetical savings fifty-fifty over stocks and bonds. This could be interpreted either as going for the default choice or the 1/n heuristic. We find a pink portfolio effect among older women, and a significant of framing which is larger for women than for men. We also find that women who already own stocks allocate significantly more to the stock basket than women who do not, which may be interpreted as an effect of familiarity. We find no such effect among men. Our evidence does not show that lack of familiarity with the large companies most traded at the Amsterdam stock exchange explains the gender gap in participation and portfolio choice. What we do find, however, is that a pink portfolio reduces decision time for women, and results in women deciding quicker than men.

21. Reverse mortgage: a tool to reduce old age poverty without sacrificing social inclusion

▸ Homeownership is widespread, in Europe, particularly among older people, with even lowincome households holding a significant amount of housing wealth ▸ Because of the low liquidity of housing wealth, homeownership can create a mismatch between disposable income and capital. We argue that reverse mortgages – which convert housing wealth into a stream of income flows – could represent a powerful device against income vulnerability in old age ▸ This argument is supported by our (first) estimates that show that reverse mortgages could indeed play an important role in protecting older households against consumption shortfalls without displacing them from their home, thus contributing to their social inclusion. This is especially true for countries like Spain, Belgium, Italy and France

Does Home Ownership Crowd Out Investment in Children's Human Capital?

Parents generally care for their kids, either for altruistic or for strategic reasons. To secure them a better life than their own, they can invest in the childrens human capital or accumulate real wealth to bequeath to them. In equilibrium, with complete markets and no imperfection, the marginal returns from the two strategies are equalized, an optimal distribution of childrens endowment between human and financial (real) wealth is reached and no crowding out occurs. In the real world, with incomplete and imperfect markets, a displacement can occur. A strong preference for home ownership makes parents inclined to consider the house as the typical bequest-friendly asset, even at the expense of childrens education. Misperceptions of the relative returns of the two different forms of wealth, with a perceived excessive premium of the returns from housing wealth, may also be at work. We consider this picture to be highly representative of the Italian situation and analyze the possible trade off between (childrens) human and real capital by using the Bank of Italys Survey of Household Income and Wealth (SHIW). Our evidence points in the direction of confirming our hypothesis.

Life Insurance Demand: Evidence from Italian Households; A Micro-Economic View and Gender Issue

The purpose of this study is to estimate the influence of microeconomic determinants for men and women on life insurance purchase decisions. Indeed, only a few papers have tried to justify rigorously the gender-based differences in life insurance ownership. Based on survey data collected by the Bank of Italy in 2012 (the Survey on Income and Households) we estimate the propensity to buy and the willingness to pay for a life insurance contract. We examine the differences between two types of contracts, i.e. traditional life and term life insurance and show that, in all cases, women are less likely to be insured than men. The demand for insurance is highly correlated with income, family structure and employment status. Geographical variables within Italy are significantly affecting the demand too. More importantly, we introduce novel variables related to the financial status of households and their proximity to the financial market, by considering home and stock portfolio ownership. These determinants turn out to be significant and to affect demand almost as much as traditional variables. To study policy implications, we calculate the probabilities of having either life or term insurance, under several scenarios for the determinants of demand. Again, financial market proximity plays a key role.