May 12, 2013

Family Ties (Guatemala, extreme case)

From a new paper by Alesina & Giuliano:
From the abstract of the paper:
We study the role of the most primitive institution in society: the family. Its organization and relationship between generations shape values formation, economic outcomes and influences national institutions. We use a measure of family ties, constructed from the World Values Survey, to review and extend the literature on the effect of family ties on economic behavior and economic attitudes. We show that strong family ties are negatively correlated with generalized trust; they imply more household production and less participation in the labor market of women, young adult and elderly. They are correlated with lower interest and participation in political activities and prefer labor market regulation and welfare systems based upon the family rather than the market or the government. Strong family ties may interfere with activities leading to faster growth, but they may provide relief from stress, support to family members and increased wellbeing. We argue that the value regarding the strength of family relationships are very persistent over time, more so than institutions like labor market regulation or welfare systems.
The authors add:
In the extreme part of the distributions are some Latin America countries like Guatemala and Venezuela, African countries like Egypt and Zimbabwe and Asian countries like Indonesia, Vietnam and the Philippines. 
And from the conclusions:
The results in table 14 clearly show that, all in all, although strong family ties can harm societies in a variety of ways, they can also have positive effects in an individual’s life, as measured by happiness and self-reported measures of health. The magnitude of the effect is also sizeable: the beta coefficients of family ties on the three measures of wellbeing are equal to 0.08, 0.06 and 0.03 respectively (for a comparison, the impact of the highest level of education is equal to 0.09, 0.04 and 0.08).
Guatemala has extreme values in many domains.   

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