Conventional estimators based on the consumption Euler equation, intensively used in studies of intertemporal consumption behavior, produce biased estimates of the effect of children on the marginal utility of consumption if consumers face credit constraints. As a more constructive contribution,...

We present a fast and accurate computational method for solving and estimating a class of dynamic programming models with discrete and continuous choice variables. The solution method we develop for structural estimation extends the en- dogenous grid-point method (EGM) to discrete-continuous...

This paper introduces measures for how each moment contributes to the precision of the parameter estimates in GMM settings. For example, one of the measures asks what would happen to the variance of the parameter estimates if a particular moment was dropped from the estimation. The measures are...

We study the design of parental leave systems through the lens of an estimated model of parents’ joint willingness to pay for parental leave. We estimate the model using Danish register data on almost 200,000 births combined with sharp variation in economic incentives created by the parental...

We examine whether financial incentives affect fertility and family planning. We use a reform reducing child benefits paid to larger families together with Danish longitudinal register data on the universe of legal abortions and birth control pill purchases to address this question. We find that...

In this guide, we introduce the limited commitment model of dynamic household bargaining behavior over the life cycle. The guide is intended to make the limited commitment model more accessible to researchers who are interested in studying intra-household allocations and divorce over the life...

The computational time required to solve and estimate dynamic economic models is one of the main constraints in empirical research. The Endogenous Grid Method (EGM) proposed by Carroll (2006) is known to offer impressive speed gains over more traditional stochastic dynamic programming methods,...

We study the causal link between earmarked paternity leave policies and the relative income share of women within couples. We utilize high quality administrative longitudinal register data for the universe of Danish individuals with a reform in 1998, which increased the earmarked paternity leave...

A common approach to estimation of dynamic economic models is to calibrate a sub-set of model parameters and keep them fixed when estimating the remaining parameters. Calibrated parameters likely affect conclusions based on the model but estimation time often makes a systematic investigation of...