Sixty%20Years%20after%20the%20Magic%20Carpet%20Ride:%20The%20Long%20Run%20Effect%20of%20Early%20Childhood%20Environment%20on%20Social%20and%20Economic%20Outcomes

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Sixty Years after the Magic Carpet Ride The Long
Run Effect of Early Childhood Environment on
Social and Economic Outcomes

• Eric Gould, Victor Lavy and Daniele Paserman
• June 2008
• CMPO Conference

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Economic Effects of an Individuals Early
Childhood Conditions

• Major interest to social scientists how much
  does the environment matter for outcomes?
• Yet, drawing causal inference about this
  relationship is complicated due to
• Unmeasured individual heterogeneity that affect
  outcomes and childhood environment
• Severe data limitation that restrict long follow
  up from childhood to adulthood.

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Most related literature

• Oreopoulos (2003) examines effect of neighborhood
  on labor market outcomes 30 years later
• Neighborhood quality plays little role in
  determining a youths eventual earnings,
  unemployment likelihood, and welfare
  participation.
• Several studies based on the Moving to
  Opportunity (MTO) project (Katz, Kling, Liebman
  and coauthors)
• Beneficial effect on education, risky behavior
  and health for girls, but not for boys.
• Ethiopian immigrants in Israel who were allocated
  (essentially randomly) to better schools had
  higher educational outcomes (Gould,Lavy,Paserman
  2004).

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This Study

• Exploits the airlift of Yemenite immigrants to
  Israel in 1949 (Operation Magic Carpet) as a
  natural experiment to overcome the identification
  problem.
• Basic idea Yemenite immigrants were scattered
  across the country in an essentially random
  manner.
• Results based on a survey of the entire
  population of those born in Yemen, immigrated
  between 0-5 years old, 56-61 years old in 2006.
• Provides rare evidence on the very long-run
  effects of early childhood environment on an
  array of social and economic outcomes.
• Relates to literature in development, urban
  economics, and the effects of immigrant enclaves.
  

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Preview of Findings

• Individuals who grew up in better conditions
  accumulated more human capital.
• Married at an older age, had fewer children.
• Less likely to be religious, more likely to be
  assimilated socially and culturally, but no
  effect on political views.
• Weak evidence of an effect on health and
  employment outcomes.
• Some evidence of an effect on the next
  generations educational outcomes.
• Most of the significant effects are due to the
  effect on females rather than males.

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Background
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Background

• A Jewish community has been present in Yemen
  since very ancient times.
• With the rise of Islam, Jews were subject to the
  dhimma protected by the state, but some
  restrictions on legal and social rights, and
  special taxes.
• 20th century mostly artisans and merchants, some
  farmers and land-owners. About one third in Sanaa
  area.
• Initial trickle of migration to Israel in the
  first part of the 20th century.
• Push for migration increases as Arab-Jewish
  relations deteriorate as a consequence of
  intensifying hostilities in Palestine.

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Background
GDP per capita (2000 USD) GDP per capita (2000 USD) GDP per capita (2000 USD)
1950 2000
USA 11,233 34,364
Israel 4,916 22,236
Yemen ? 1,081

Egypt 1,257 4,535
Ethiopia 330 725
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Operation Magic Carpet

• Rescue operation to airlift the entire Yemenite
  Jewish community to Israel, between late 1948 and
  1950, mainly at end of 1949.
• By the end of the operation in early 1950,
  approximately 50,000 had been flown to Israel

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Operation Magic Carpet

• Uprooted from their traditional way of life to a
  modern society and culture.
• The immigrants were dispersed throughout the
  country into 4 makeshift absorption camps.
  Duration of stay up to one year.
• For strategic reasons many were placed in areas
  where the population needed to be bolstered.
• Many newly created agricultural communities
  (moshavim) built exclusively for Yemenite
  immigrants.
• As a result, they were scattered across the
  country in a manner irrespective of their
  background.

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Quasi-random allocation of immigrants to locations

• Quasi-random allocation due to
• Homogenous background.
• Complete culture shock.
• Lack of understanding of spoken Hebrew.
• Patronizing attitude of Ashkenazi establishment.
• Reliance on Israeli bureaucrats to tell them
  where to live and what to do.
• Overall chaotic and precarious situation of the
  entire country.

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Data

• Population of interest all people born in Yemen
  in 1945-50 who migrated to Israel in 1948-51
  (migrated as very young children).
• Survey conducted between June and October 2006.
  Population between 56 and 61 years old very much
  long-term outcomes!
• Questions on
• Family background in Yemen.
• Location of residence and living conditions upon
  arrival, and in subsequent two localities.
• A variety of social and economic outcomes
  employment, income, marriage, fertility, health,
  cultural tastes, and their childrens education

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The survey

• List of 5,776 names of people born in Yemen
  between 1945 and 1950.
• Private company located phone numbers of 4,160
  (72).
• 3,364 completed interviews. Approximately 10
  discarded because immigrated before 1948 or after
  1951. 2,991 completed surveys (gt80 of those
  contacted.)
• 264 re-interviews to establish childhood
  environment.
• Final sample 2,927 individuals.
• 130 questions, 20 minutes to complete.

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The survey

• Respondents were cooperative and knowledgeable.
• They knew a great deal about their family
  background.
• Information on family background in Yemen
  internally consistent.
• Table 2 High socioeconomic status correlated
  with
• Fathers occupation merchant (), craftsman(-).
• Owned land and livestock, hired employees.
• Lived in a major city in Yemen.
• Community or religious leader.

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Methodology

• Identify childhood environment locality of
  residence, circa 1955.
• Construct three summary measures of the childhood
  environment
• Whether the home had running water, sanitation
  and electricity.
• Whether the locality of residence was in an urban
  environment with a good economic infrastructure.
• Whether the locality of residence was a Yemenite
  enclave (a place built specifically for Yemenite
  immigrants).

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Random assignment?
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Random assignment?
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Random assignment?

• Family socioeconomic status is balanced with
  respect to childhood environment.
• Some evidence that people from urban background
  in Yemen more likely to end up in urban
  environment in Israel.
• Imbens ratios suggest that the differences are
  small (most IRs lt 0.25).
• Similar pattern of selection between boys and
  girls.
• Likely that government officers responsible for
  assignment had similar set of information
  available to us.
• Strategy control for all observable family
  background characteristics, show that selection
  effect is modest.

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Table 8 Estimates of the Effects of the
Childhood Environment on Education Outcomes
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Table 8 Estimates of the Effects of the
Childhood Environment on Education Outcomes
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Table 8 Estimates of the Effects of the
Childhood Environment on Education Outcomes
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Table 8 Estimates of the Effects of the
Childhood Environment on Education Outcomes
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The Effect of Childhood Environment on Education
Outcomes

• Strong evidence that the childhood environment
  affected educational outcomes for girls, but not
  for boys.
• Result robust to using different measures of the
  childhood environment.

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Mechanisms
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Table 9 Estimates of the Effects of the
Childhood Environment on Marriage and Fertility
Outcomes
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Table 10 Estimates of the Effects of the
Childhood Environment on Health Outcomes
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Table 11 Estimates of the Effects of the
Childhood Environment on Employment Outcomes
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Table 12 Estimates of the Effects of the
Childhood Environment on Attitudes and
Assimilation Outcomes
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Table 13 Estimates of the Effects of the
Childhood Environment on Children's Education
Outcomes
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Other outcomes

• The effect of a good environment
• Marriage and fertility higher age at first
  marriage, fewer children, more likely to be
  divorced (women only).
• Health No effect.
• Employment Women more likely to be employed.
• Attitudes and assimilation no effect on
  political attitudes, less religious (men and
  women), more cultural assimilation.
• Childrens outcomes some evidence that male boys
  are affected by the quality of the environment of
  the father.

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Robustness checks

• Results are similar when we condition also for an
  indicator of those whose childhood location was
  chosen by the government
• Estimates are similar when based on the sample of
  those sent to childhood locations by the
  government
• Estimates do not change at all when we include
  first the balanced characteristics and then the
  unbalanced ones
• When allowing for interaction effects, the effect
  of the environment does not vary with background
  characteristics
• No differences in the age distribution of men and
  women
• Gender does not affect the probability of moving

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Potential weaknesses

• Survivor bias that leads to sample selection
  bias. Maybe people in worse environments didn't
  make it past childhood
• Recollection bias, people who have better
  outcomes today may paint their initial
  environment brightly than what it really was. BUT
  it can go the other direction those who have
  succeeded might tend to emphasize how bad their
  initial conditions were

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Why different effects for girls and boys?

• Data from 1961 Census, able to identify location
  of residence in 1956.
• 14-16 year old girls much less likely to be
  enrolled in school in rural localities built
  after 1948 for immigrants 74 vs. 62.
• However, much more likely to be employed 15 vs.
  39.

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School enrollment and LFP of Yemenite youth, Israeli 1961 census (N1125) School enrollment and LFP of Yemenite youth, Israeli 1961 census (N1125) School enrollment and LFP of Yemenite youth, Israeli 1961 census (N1125) School enrollment and LFP of Yemenite youth, Israeli 1961 census (N1125) School enrollment and LFP of Yemenite youth, Israeli 1961 census (N1125)
Boys Boys Girls Girls
Urban Rural Urban Rural
In school
14-16 yrs old 65.6 76.0 73.9 62.0
17-18 yrs old 33.9 36.8 32.4 29.8

Wrkd last wk
14-16 yrs old 24.8 25.7 15.2 39.4
17-18 yrs old 51.5 51.2 43.3 34.4
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Why different effects for girls and boys?

• Our interpretation interaction of low
  benefits/high costs of schooling and cultural
  norms.
• lifetime labor supply of women expected to be
  very low, especially in rural areas and ethnic
  enclaves where traditional cultural norms more
  likely to be enforced.
• Costs of attending school are higher.
• Conjectures
• in rural areas, boys wanted to attend religious
  schools ? attended boarding school, could not
  help family with work.
• Dowries.
• Not consistent with
• Simple labor supply (wages higher in the city).
• Substituting for mothers work (mothers didnt
  work, in either urban or rural areas).
• Girls had poorer health in rural areas (does not
  explain why they are at work).

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Conclusion

• We have exploited the natural experiment provided
  by Operation Magic Carpet to study the long run
  effects of the childhood environment on social
  and economic outcomes.
• High quality initial environment has a large
  positive effect on most womens outcomes
  education, marriage and fertility, employment,
  cultural assimilation.
• Smaller or no effect for men.

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Thank you!
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