Leaving your mamma: why so late in Italy?

Article

Abstract

In Italy, young adults tend to postpone their transition to adulthood and live with their parents until very late compared with other countries. A dynamic discrete choice model is proposed in which agents choose residential arrangements, together with labor supply and marital status, conditional on the economic and institutional framework and on other agents’ choices. The model is structurally estimated with the Simulated Method of Moments for non-student high-school graduate males and then used to assess, through a variety of counterfactual experiments, the relative importance of factors that are claimed to influence the choice to leave home in the existing literature: labor market conditions, parental resources, housing market conditions and social interaction. Results suggest that Italians choose to remain with their parents due to a combination of poor labor market conditions and high housing costs. The relatively high income of parents could contribute to the patterns observed by acting as an insurance against unemployment. Finally, estimates indicate that individuals tend to conform to a social norm, especially in the South of the country were family ties and the costs in terms of utility from not complying with expected behaviors appear to be stronger.

Keywords

Transition to adulthood Co-residence Structural estimation NEETs Youth Policy 

JEL codes

J11 J12 H31 D10 D31 

Notes

Acknowledgements

The opinions expressed and conclusions drawn are those of the author and do not necessarily reect the views of the Bank of Italy.

Compliance with ethical standards

Conflict of interest

The authors declare that they have no competing interests.

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Copyright information

© Springer Science+Business Media, LLC 2017

Authors and Affiliations

  1. 1.Bank of ItalyRomeItaly

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