Essays on Family Economics and Human Capital Development

Abstract

This dissertation consists of three essays on family economics and human capital development. In the first essay, I estimate the effect of screening for gestational diabetes on birth outcomes using a regression discontinuity design and exploiting exogenous variation in screening at the overweight threshold of the body mass index. I do not find an impact of screening for gestational diabetes on birth outcomes, i.e. birth weight and cesarean section related outcomes. An additional analysis using a differences-in-differences framework and the introduction of the policy provides suggesting evidence that expanding the screening to overweight mothers (otherwise not prone to developing gestational diabetes) did not have an effect on birth outcomes. The second essay, which is joint-work with Kristiina Huttunen studies the impact of parental job loss on children's schooling choices. We use administrative data from Finland that allows us to follow all family members for over 20 years. Our results show that father's job loss decreases the likelihood that a child chooses the same study choice as the parent. Children of displaced fathers are also more likely to choose a "safer" field in terms of employment prospects. We find no impact on children's outcomes measured before schooling choices are made, such as crime and school grades. The results suggest that children's schooling decisions are an important mechanism through which childhood shocks can affect later life outcomes. In the third essay, I study the effect of the Finnish child home care allowance, for which parents with children aged 1-to-3-years are eligible, on marital stability. I use variation across regions and over time in the allowance created by the municipal supplement to identify the causal effect. I find that child home care allowance has a modest positive effect on marital stability in the long-run. A 100 euros increase in the supplement increases the probability that the mother has the same spouse ten years later by 0.8 %. Further analysis shows that the mechanism varies depending on how the mother would have behaved in the absence of the municipal supplement. For those who are more likely to stay at home even in the absence of the municipal supplement, the supplement has no effect on the employment or take-up in the short-run, but has instead, a positive effect on income. For this group, I find a positive effect on marital stability both in the short-run (4.6 %) and in the long-run (4.3 %). For those who are possibly pushed into taking home care allowance by the municipal supplement, I find a long-lasting decrease in employment, and a modest positive effect on marital stability that shows up later (0.5 %).