Parental Preferences, Production Technologies, and Provision for Progeny

11 Pages Posted: 3 May 2022

See all articles by Maoliang Ye

Maoliang Ye

Southern University of Science and Technology

Junjian Yi

Peking University

Date Written: September 1, 2016

Abstract

Ye, Maoliang, and Yi, Junjian-Parental preferences, production technologies, and provision for progeny

This paper theoretically explores the implications of the recent developments in the study of human capital production technologies (Cunha and Heckman, 2007) in intrahousehold human capital investment in children (Becker and Tomes, 1976; Behrman et al., 1982). When credit constraints are not binding, parents adopt a reinforcing intrahousehold investment strategy. When credit constraints are binding, the trade-off between the degree of parental aversion to inequality and the degree of complementarity between pre-natal endowments and family investments determines the parental strategy. The observed investment pattern of reinforcement or compensation does not necessarily reveal the underlying preference or technological parameters. Finally, we discuss empirical methods that may separately identify the preference and technological parameters and discuss the econometric challenges associated with these methods.

Keywords: Intrahousehold human capital investments, Reinforce, Compensate, Parental preferences, Production technology

JEL Classification: D10, D13, J24

Suggested Citation

Ye, Maoliang and Yi, Junjian, Parental Preferences, Production Technologies, and Provision for Progeny (September 1, 2016). Journal of Comparative Economics, 2016, Available at SSRN: https://ssrn.com/abstract=4095473

Maoliang Ye (Contact Author)

Southern University of Science and Technology ( email )

College of Business
Rm. 525, Taizhou Building
Shenzhen, 518055
China

Junjian Yi

Peking University ( email )

National School of Development
Peking University
Beijing, Beijing 100871
China

HOME PAGE: http://https://en.nsd.pku.edu.cn/faculty/fulltime/y/520194.htm

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