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Eng Book- The Power of the Family- Download Free PDF


The structure of family relationships influences economic behavior and attitudes. We define
our measure of family ties using individual responses from the World Value Survey regarding
the role of the family and the love and respect that children need to have for their parents for
over 70 countries. We show that strong family ties imply more reliance on the family as an
economic unit which provides goods and services and less on the market and on the
government for social insurance. With strong family ties home production is higher, labor
force participation of women and youngsters, and geographical mobility, lower. Families are
larger (higher fertility and higher family size) with strong family ties, which is consistent with
the idea of the family as an important economic unit. We present evidence on cross country
regressions. To assess causality we look at the behavior of second generation immigrants in
the US and we employ a variable based on the grammatical rule of pronoun drop as an
instrument for family ties. Our results overall indicate a significant influence of the strength of
family ties on economic outcomes.
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