"Preparing Kids for Capitalism: The Effect of German Reunification on the Intergenerational Transmission of Preferences"
Mariko J. Klassing, joint with Matthias Doepke
Lemma - 4 rue Blaise Desgoffe, 75006 Paris. Salle Maurice Desplas
Mariko is Associate Professor at the University of Groningen. She is Associate Editor at the Journal of Comparative Economics. She works on political economy.
Abstract : Among the many dimensions along which children are similar to their parents are economic preferences such as patience and risk aversion. But what drives the correlation in preferences of parents and children? We build a theoretical model featuring different channels of cultural transmission and use the natural experiment of German reunification to shed light on this question. The model highlights that different potential transmission channels have distinct implications for how transmission should differ between the East and theWest, and how reunification should affect parent-child correlations. Specifically, genetic channels should act independently of the political regime; passive transmission channels should interact with the greater use of government-provided childcare in East Germany versus parent-provided care in West Germany; and parents’ active socialization efforts should be responsive to the new challenges that moving from a socialist to a capitalist system presents. Empirical evidence from the correlation of preferences between parents and children born on both sides of the border before, during, and after the political transition suggests that government intervention had little impact on preference transmission. In contrast, both genetic and active transmission channels find strong support.
"A Model of China's Economic Vertical Structure"
WANG Yong, with Xi Li, Xuewen Liu, and Zhikun Lu.
Lemma - 4 rue Blaise Desgoffe, 75006 Paris. Salle Maurice Desplas