Changes In Household Characteristics Research Articles

The great expansion of 2019 and the delinquency rates of blacks and hispanics

ABSTRACT During a period of increasing prosperity, the U.S. debt delinquency rate decreased between 2016 and 2019, with a relatively large decrease for Asians households and somewhat smaller decrease for Blacks and Whites, while the rate for Hispanics stayed constant. Blacks were more likely to be delinquent than Whites and Hispanics. Controlling for household characteristics, there was not a significant year effect for delinquency, suggesting that changes in household characteristics accounted for the overall decrease between 2016 and 2019. Additional analyses showed the Black delinquency rate in 2016 was not significantly different from the White rate, but was higher than the White rate in 2019. In both years, Hispanics had lower delinquency rates than Blacks. We discuss possible explanations for the differences between Hispanics and Blacks.

Decomposing changes in inequality: Evidence from Myanmar

AbstractWe study the determinants of changes in the distribution of household expenditures in Myanmar, using a large, nationwide panel household survey data set covering 2005 and 2010, the only panel household survey data currently existing for Myanmar. There was no statistically significant change in mean real consumption expenditures between these years, but the distribution of that consumption across households became significantly less unequal. The sources of this large decline in measured inequality have not been systematically investigated. The paper attempts that investigation by using the above data and applying regression‐based inequality decomposition methods developed by Fields and its subsequent extension by Yun.The results using Fields’ approach indicate that region‐specific variables, occupational changes, and education were the main factors contributing to the narrowing of expenditure inequality but that road development expenditures had the opposite effect. On the methodology of decomposition, we argue first that the Yun extension of Fields’ approach promises enhanced policy relevance, by distinguishing between changes in household characteristics and changes in their impact on expenditures. Second, we show that the decomposition described by Yun entails arbitrary sequencing of the distributions being compared, substantially influencing the decomposition obtained. We explain the underlying reason for this problem and demonstrate a simple solution.

An Analysis of U.S. Domestic Migration via Subset-stable Measures of Administrative Data

How does the likelihood of moving across U.S. regions vary with changes in household characteristics, and how does the risk of a change in status vary given a move? Statistics aimed at these questions are calculated for households who earned formal market income in the U.S., 2001—2015, totaling about 1.7 billion observations with 82.7 million long-distance moves, and covering statuses such as income, school enrollment, age, number of children, local cost of living, retirement or marital status. The key theoretical result of this article shows that the Cochran-Mantel-Haenszel statistic is the unique aggregate risk ratio within a broad class that has the stability property: If a statistic has value s₁ for one subset and s₂ for another, then the statistic for the union of the two sets is between s₁ and s₂. A sequence of pseudo-experiments generate a wealth of tests regarding the relationship between moving and a broad range of household characteristics, for the full population and salient subsets, with some focus on the characteristics of the 44.2% of movers who see negative income returns relative to the counterfactual of staying.

Dynamics of Smallholder Farmers’ Livelihood Adaptation Decision-Making in Central Ethiopia

In previous studies mainly focusing on determinants of adaptation, evidence of the dynamic process of adaptation decision-making is negligible. The objective of this study was to investigate the effects of socio-cultural factors, changes in household characteristics, and climate variables on the transition from non-use to use of adaptation strategies. The study integrated primary data collected from households with secondary rainfall and temperature data. The quantitative and qualitative data were analysed using a dynamic random-effects probit model and a thematic approach, respectively. The result shows strong evidence of path dependence in which use of a strategy during the previous year significantly increases its current use. Climate-related risk perception and factual knowledge may not necessarily prompt adaptation action, whereas access to financial resources and farming-related trainings were consistent positive predictors of farmers’ adaptation decisions. The findings entail that economic capacity and the associated intrinsic motivation help few farmers to utilise robust and contesting adaptation strategies. For most households, economic problems and the consequent fatalistic attitude and risk-avoidance behaviour induce either non-use or use of responsive and accommodating strategies aimed at ensuring survival. Path dependence in non-use of adaptation strategies and sub-optimal adaptation actions demand effective institutional supports to address the behavioural and economic barriers of these households in order to build overall community resilience.

The decrease in life insurance ownership

Based on our analyses of Survey of Consumer Finances datasets, the proportion of households owning a life insurance policy decreased from 72% in 1992 to 60% in 2016. We estimated logistic regressions on the likelihood of ownership of any, term, and cash value life insurance. We conclude that changes in household characteristics accounted for the decrease in term life insurance ownership, but not for the decreases in any and in cash value life insurance ownership. We also found a positive association between use of a financial planner and life insurance ownership. We discuss implications for financial planning.

Assessing food and nutrition security in Nepal: evidence from diet diversity and food expenditure patterns

The widespread prevalence of nutrient deficiency and poor nutritional outcomes has been a significant concern in developing and emerging countries like Nepal. The level of diversity in household diets is an indirect measure of diet quality and the extent to which nutritional needs of households are being met. However, there is a limited understanding on the trends, patterns and determinants of the dietary diversity in Nepal. This study is an attempt to enrich the literature on this issue. Based on unit level data from three rounds (1995, 2004, and 2011) of the Nepal Living Standard Survey (NLSS), we used multilevel modeling, quantile regression, and the Blinder-Oaxaca decomposition method to decipher the trends, determinants and drivers of dietary diversity in Nepal. Our study finds that the changes in household socio-demographic and agricultural characteristics are very important in explaining the improvement in dietary quality. Changes in household characteristics account for at least 37% of the observed improvement and agriculture-related changes explain at least 16% of the observed improvement. Our findings are highly robust across the different model specifications and concludes by bringing a focus on multi-sectoral approach to tackle nutrition issues in Nepal.

Analyzing the Effects of Financial and Housing Wealth on Consumption Using Micro Data

This paper analyzes the existence of 'wealth effects' derived from net equity (in the form of housing, financial assets, and total net worth) on consumption. The study uses longitudinal household-level data -- from the Panel Study of Income Dynamics (PSID) -- covering about 7,000-9,000 households in the U.S., with the estimations carried over the period 1999-2017. Overall, wealth effects are found to be relatively large and significant for housing wealth, but less so for other types of wealth, including stocks. Furthermore, the analysis shows how these estimated marginal propensities to consume (MPC) from wealth are closely linked to household characteristics, including income and demographic factors. Finally, underlying structural changes in household characteristics point to potentially lower aggregate MPCs from wealth going forward.

Analyzing the Effects of Financial and Housing Wealth on Consumption using Micro Data

This paper analyzes the existence of “wealth effects” derived from net equity (in the form of housing, financial assets, and total net worth) on consumption. The study uses longitudinal household-level data?from the Panel Study of Income Dynamics (PSID) ?covering about 7,000-9,000 households in the U.S., with the estimations carried over the period 1999-2017. Overall, wealth effects are found to be relatively large and significant for housing wealth, but less so for other types of wealth, including stocks. Furthermore, the analysis shows how these estimated marginal propensities to consume (MPC) from wealth are closely linked to household characteristics, including income and demographic factors. Finally, underlying structural changes in household characteristics point to potentially lower aggregate MPCs from wealth going forward.

The changing distribution of wealth in the pre-crisis US and UK: the role of socio-economic factors

The USA and the UK experienced substantial increases in net wealth in the decade that preceded the financial crisis, largely driven by house-price booms in each country. The distribution of these gains across households led to a slight increase in wealth inequality in the USA but a substantial fall in inequality in the UK. We use a decomposition technique to examine the extent to which changes in households' socioeconomic characteristics explain changes in wealth holdings and wealth inequality. In both countries we find that changes in household characteristics had an equalizing effect on wealth inequality, moderating the increase in the USA and accounting for over one-third of the fall in UK wealth inequality.

Exploring the Rise of Mortgage Borrowing Among Older Americans

This paper documents and examines the rise in mortgage usage among older Americans over the past 30 years. It uses data from a variety of sources including the Health and Retirement Study, Decennial Census, American Community Survey, Survey of Consumer Finances, and the American Housing Survey. We begin by documenting the large increase in mortgage usage among older Americans across age and income distributions. We then use regression analysis to test for causes of the mortgage increase and subgroup heterogeneity, in particular focusing on changing health, bequest motives, and tax policy incentives. This paper found that: -Americans over age 60 are more than three times as likely to have mortgage debt in 2015 compared to 1980, a 24-percentage point increase. This is a consistent increase across the income distribution. -Increases to homeownership account for some of the rise in mortgages, but this has increased by only 9 percentage points among Americans over age 60 between 1980 and 2015. -Younger age groups have had much smaller increases, and sometimes decreases, in mortgage usage and homeownership over the same time period. -Changes in household characteristics, such as education, urbanization, race, income, and marriage rates explain only a small portion of the increase in mortgage rates. -Households with below-median assets, and those without pensions, account for a greater share of the rise in older households’ mortgage borrowing. -Changes in subjective health and bequest motives explain little of the rise in mortgage rates. Variation in the mortgage interest deduction explains part of the differential increase in mortgage usage by age. The policy implications of the paper are: -Policymakers should be aware that the beneficiaries of mortgage and homeownership subsidies, such as the mortgage interest deduction, have changed substantially over the past 30 years. -Increased mortgage usage has coincided with less total debt among seniors relative to younger cohorts and has not resulted in increased delinquency. This may indicate that the negative aspects of increased mortgage usage are limited. -Further investigation into the causes and consequences of mortgage usage is needed in considering appropriate policy responses.

Household Income, Women's Earnings, and Spending on Household Services, 1980–2010

The authors investigated changes in household outsourcing, the practice of spending on services that replace household labor, from 1980 to 2010. During this time, women's labor force participation, increased and economic, household bargaining, and time availability theories predict increased spending during this period. To test these predictions, the authors used data on spending on housekeeping, day care, babysitting and nannies, gardening and lawn services, eating out and pre‐prepared foods from the 1980–2010 Consumer Expenditure Surveys using 327,903 household‐quarters from the interview survey and 86,877 household‐weeks from the diary survey. The results indicate that changes in income predicted increases in housekeeping, child care, and gardening services. Changes in household characteristics predicted little change in food outsourcing, although food outsourcing did increase. Changes in women's earnings predicted little change in most outsourcing. The authors conclude the article with a discussion of the changing context for outsourcing.

Adaptation of agriculture to climate change in semi-arid Borena, Ethiopia

Livestock production is very risky due to climate variability in semi-arid Sub-Saharan Africa. Using data collected from 400 households in the Borena zone of the Oromia Region, we explored what drives adoption of agricultural practices that can decrease the vulnerability of agro-pastoralists to climate change. Households with more adaptive capacity adopted a larger number of practices. The households’ adaptive capacity was stronger when the quality of local institutions was high. However, adaptive capacity had less explanatory power in explaining adoption of adaptation options than household socio-economic characteristics, suggesting that aggregating information into one indicator of adaptive capacity for site-specific studies may not help to explain the adoption behaviour of households. Strong local institutions lead to changes in key household-level characteristics (like membership to community groups, years lived in a village, access to credit, financial savings and crop income) which positively affect adoption of agricultural practices. In addition, better local institutions were also positively related to adoption of livestock-related adaptation practices. Poor access to a tarmac road was positively related to intensification and diversification of crop production, whereas it was negatively related to the intensification of livestock production, an important activity for generating cash in the region. Our findings suggest that better local institutions lead to changes in household characteristics, which positively affect adoption of adaptation practices, suggesting that policies should aim to strengthen local institutions.

Understanding the rural and urban household saving rise in China

This paper analyzes the different factors that drive saving rate rises of both rural and urban households in China. Using data from the Chinese Household Income Project 1995 and 2002, I first show that the whole saving rate distribution shifts up for both rural and urban households. The shift, however, differs between rural and urban households and is heterogeneous across the distribution: while rural saving increased the most at lower percentiles, urban saving experienced a larger shift at higher percentiles. Moreover, decomposition in the saving distribution shows that most of the increase in the rural saving rate is due to rising income. In contrast, only a small portion of the increase in the urban saving rate can be explained by changes in household characteristics including income. The rising urban saving rates are instead explained by changes in quantile regression coefficients over time, especially at the top of the saving distribution.

Economic Penalties and Rewards of Family Formation, Gender and Education in the Low-income Sector in Germany1

This article examines the differential effects of changes in family formations on men's and women's economic vulnerability. The motivating question is whether investments in education provide sufficient resources to escape the risk of poverty in the low-income sector or if changes in household characteristics are more important determinants of one's living standard. Changes in household characteristics are defined in terms of partners' entry into and exit from households and partners' different labour market profiles. The analysis focuses on households in the low-income sector in Germany, a population that is at high risk of poverty in a social welfare state that is expected to mitigate the effects of changes in family formation independent of gender. Findings from panel regression analysis demonstrate that women, in contrast to men, benefit economically as much as or more from investing in traditional family formations than in their own labour market position. This is especially the case for women with lower levels of education.

On the Path to Homeownership: Money, Family Composition and Low-income Households

In Norway, as in many other countries, homeownership is encouraged politically, and a majority of the households become homeowners at some stage in their life cycle. Many households move house when circumstances change, and it is often at this point that they also make their tenure choice. This paper employs a bivariate probit framework to model the transition rate from renting into homeownership. Using a sample of initial renters, subsequent tenure choice is analysed jointly with the stay-move decision. A particularly important question in this context is whether low-income households face differential constraints on entering owner occupation that could be addressed by policy change. The empirical model includes financial characteristics, household characteristics and changes in household characteristics as explanatory variables. Changes in household composition are particularly important in explaining variations in both tenure choice and mobility. Hence, the common practice of estimating housing market behaviour using a panel of intact households potentially obfuscates important determinants of that behaviour. The paper proceeds by using the equivalent of a Chow test to show that a hypothesis of equal coefficients in samples of low- and high-income households is firmly rejected. Thus low-income households do behave differently. Short-term variations in income appear to have little effect on people's capacity to enter owner occupation. However, low-income households are more dependent on past savings for successful entry. This suggests a rather different policy approach if owner occupation is to be expanded.

Equalizing or Not? The Effect of Changing Household Characteristics on Income Inequality

Among the various factors which have been explored to explain differences and trends in income inequality, there is one which has received relatively little attention: differences and changes in household characteristics. Using the data from the Bank of Italy Survey of Household Income and Wealth, this article examines the relationship between family demographic and economic characteristics and income inequality. More precisely, it analyses how much and in which direction (boosting vs. containing) recent changes in household forms have affected the level of income inequality in Italy. The analysis shows that the equalizing power of Italian families has decreased in recent decades, and that the most recent changes in household forms do not have a clear equalizing effect. On the other hand, it is also found that the relevance of income differences between household forms in determining the level of income inequality is on the increase.

Agroforestry diffusion and secondary forest regeneration in the Brazilian Amazon: further findings from the Rondônia Agroforestry Pilot Project (1992–2002)

In July 1992 the Rondonia Agroforestry Pilot Project (RAPP) was launched in two agricultural municipalities (Nova Uniao and Alto Paraiso) in the western Brazilian Amazon State of Rondonia. The purpose of the RAPP was to assess the conditions under which colonist farmers in the western Amazon would integrate agroforestry plantings into their small-scale farming systems and to assess the performance of those plantings over time. An experimental group consisting of 50 small-scale farmers was selected to participate. Plots were designed to accommodate between 3 and 25 different species, each producing one or more commodities with local market potential (hardwood, fruits, nuts, latexes, oils). Farmers planted seedlings typically on a 1-ha plot, located and designed by each farmer with the advice of a professional Brazilian extensionist. During the first phase of the project (1992–1998), the growth performance of the seedlings and changes in household characteristics were monitored on an annual basis. By 2002, 32 (64.0%) of the original 50 agroforest plots were found in place. This paper updates the research findings based on a 2002 follow-up visit to these 32 farms. In addition to growth performance, the authors’ found that 17.95% of the farms in the neighboring control group had planted trees and other agroforest crops between 1992 and 2002, compared to only 5.38% of farms outside the project area, suggesting spontaneous diffusion. The authors also found a potentially synergistic relationship between agroforestry and secondary forest regeneration with the use of satellite image analysis. The experience of the RAPP indicates that colonist farmers in Amazonia can be successful managers of agroforest plots with minimal external inputs over the long-term (10 years).

Is Wealth Becoming More Polarized in the United States?

Recent work has documented a rising degree of wealth inequality in the United States between 1983 and 1998. In this paper we look at another dimension of the distribution: polarization. Using techniques developed by Esteban and Ray (1994) and extended by D'Ambrosia (2001), we examine whether a similar pattern exists with regard to trends in wealth polarization over this period. The approach followed provides a decomposition method, based on counterfactual distributions, that allows one to monitor which factors modified the entire distribution and precisely where on the distribution these factors had an effect. An index of polarization is provided, as are summary statistics of the observed movements and of distance and divergence among the estimated and the counterfactual distributions. The decomposition method is applied to U.S. data on the distribution of wealth between 1983 and 1998. We find that polarization between homeowners and tenants and among different educational groups continuously increased from 1983 to 1998, while polarization by income class continuously decreased. In contrast, polarization by racial group increased from 1983 to 1989 and then declined from 1989 to 1998, while polarization by age group followed the opposite pattern. We also find that most of the observed variation in the overall wealth density over the 1983–98 period can be attributed to changes in the within-group wealth densities rather than changes in household characteristics.

Household Location and Race: Estimates of a Multinomial Logit Model

A multinomial logit model of household location choice, in which families choose from a number of mutually exclusive residential location, is estimated. Regression results indicate that the locational choices of white and black households are importantly, but differently, affected by their socioeconomic characteristics; in that regard, black suburbanization patterns are little influenced by large simulated changes in household characteristics. Findings suggest that policies which focus on the educational and earnings opportunities of blacks would likely be largely ineffectual in fostering the integration of predominantly white suburban communities. Copyright 1989 by MIT Press.

Marketed Surpluses of Agricultural Households in Sierra Leone

AbstractAn agricultural household model is used with household level data from Sierra Leone to estimate elasticities of marketed surplus for several outputs and for labor with respect to price and nonprice variables. Positive own‐price elasticities are found, with magnitudes considerably above own‐price output elasticities. Changes in household characteristics and production technology also affect marketed surpluses but not always in anticipated directions. Elasticities are reported for households when grouped by their total expenditure, not just for the sample mean. The differences are important, showing that low expenditure households respond as much as high expenditure households.