Intergenerational Transmission of Disadvantage: Negative Parental Selection, Economic Upheaval, and Smoking

Recessions negatively impact the health of individuals experiencing hardship. In this paper, we investigate whether there are also long-term effects for those born during difficult economic times through the effects on their health behavior. Based on a theoretical model of parental socialization against smoking and using data from the German Socioeconomic Panel, we assess smoking behavior of children born in the years immediately after the fall of the Berlin Wall in the East. Using a difference-in-differences specification with West Germans as a control group, we find that men born during this time were 40% more likely to smoke in young adulthood than men born during the years before or afterwards. The fall of the Berlin Wall led to enormous social and economic upheaval and resulted in a stark drop in incomes and fertility in East Germany. Fertility, however, dropped least among the lower educated and younger mothers. The resulting negative parental selection, as measured by parental education and childhood family environment, explains about one fifth of the higher incidence of smoking of those born during this time. We posit that the effect of negatively selected parents was amplified by the compounding effect of disadvantage in childhood caused by the economic upheaval, which likely reduced both the amount and quality of parental socialization against smoking, leading to the increased smoking rates that we observe.