Economists: "Losing both parents sucks"

Have you ever wondered whether losing both parents to a tragedy might be a bad thing or not? Well, economists did.

When life gives you lemons, you make lemonade. And when you're trying to study the effects of parental death on children, you need to get your victories where you can find them. For four economists writing a working paper for the US National Bureau of Economic Research (highlighted by the ASI's Ben Southwood), their break came from the 2004 Boxing Day tsunami.

The problem the researchers were faced with is that parents don't die randomly. Deaths by disease, violence and accidents are all highly correlated with other social factors – most obviously, wealth. Really, that's just another way of saying "rich people live longer".

But the tsunami offered a chance to see what happened when the chance of parents dying was equal across all classes. They write:

Survival was to large extent attributable to idiosyncratic factors revolving around the combination of where the waves hit and people’s precise locations at that moment. For these reasons, it is possible that parental death is independent of prior behaviors, including previous investments in children.

As it is, there were in fact a few differences between the group of children who lost parents and the group who didn't. The former group were slightly older, had slightly more boys in it, and the kids were "significantly better educated and significantly more likely to be enrolled in school prior to the tsunami."

But those differences are tiny compared to what they normally are between those two groups, which gave the researchers a chance to carefully examine the effect of losing one or both parents on children's wellbeing.

Unsurprisingly, it was negative.

A year after the tsunami, older children – between the ages of 15 and 17 – are less likely to be enrolled in school, especially if it were the father who died. Five years on, older male children who've lost both parents completed almost two years less schooling, but are more likely to be in work, indicating that doing so forced them to move into to role of "adult" earlier than similar young men. "These older male orphans are likely to carry the costs of the tsunami into adulthood and possibly through the rest of their lives."

A similar effect is found, reversed, in older girls. Losing just a father actually lead to higher rates of school enrolment in the short term, but losing both parents or a mother results in the opposite. And five years after the tsunami, the older girls – young women – are considerably more likely to be married if they lost both parents than if they lost none.

For younger children, there's a confounding factor: various scholarship programmes were instituted for kids who lost parents. Perhaps as a result, younger boys were no more or less likely to be enrolled in school, but they were 32 percentage points more likely to have received a scholarship if their father or both parents died. Perhaps surprisingly, "there is little evidence suggesting significant longer-term impacts of orphanhood on these younger male children apart from a slightly higher probability of helping with housework if either the mother or father died." And loss of both parents for young girls results in a 24 per cent increase in the probability that they'd be working five years later.

It may seem like an obvious conclusion, but research like this is crucial if we want to actually make the most of things like our emergency aid. For instance, focusing scholarships on younger children may have worked from a PR perspective; but it was actually the older children who were most at risk of dropping out of school, as suddenly-alone parents demanded help at home or in the labour market. God forbid anything like the 2004 tsunami happens again; but if it did, this research helps us narrow down who needs help in the long term, not just immediately.

The aftermath of the tsunami. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Getty
Show Hide image

Debunking Boris Johnson's claim that energy bills will be lower if we leave the EU

Why the Brexiteers' energy policy is less power to the people and more electric shock.

Boris Johnson and Michael Gove have promised that they will end VAT on domestic energy bills if the country votes to leave in the EU referendum. This would save Britain £2bn, or "over £60" per household, they claimed in The Sun this morning.

They are right that this is not something that could be done without leaving the Union. But is such a promise responsible? Might Brexit in fact cost us much more in increased energy bills than an end to VAT could ever hope to save? Quite probably.

Let’s do the maths...

In 2014, the latest year for which figures are available, the UK imported 46 per cent of our total energy supply. Over 20 other countries helped us keep our lights on, from Russian coal to Norwegian gas. And according to Energy Secretary Amber Rudd, this trend is only set to continue (regardless of the potential for domestic fracking), thanks to our declining reserves of North Sea gas and oil.


Click to enlarge.

The reliance on imports makes the UK highly vulnerable to fluctuations in the value of the pound: the lower its value, the more we have to pay for anything we import. This is a situation that could spell disaster in the case of a Brexit, with the Treasury estimating that a vote to leave could cause the pound to fall by 12 per cent.

So what does this mean for our energy bills? According to December’s figures from the Office of National Statistics, the average UK household spends £25.80 a week on gas, electricity and other fuels, which adds up to £35.7bn a year across the UK. And if roughly 45 per cent (£16.4bn) of that amount is based on imports, then a devaluation of the pound could cause their cost to rise 12 per cent – to £18.4bn.

This would represent a 5.6 per cent increase in our total spending on domestic energy, bringing the annual cost up to £37.7bn, and resulting in a £75 a year rise per average household. That’s £11 more than the Brexiteers have promised removing VAT would reduce bills by. 

This is a rough estimate – and adjustments would have to be made to account for the varying exchange rates of the countries we trade with, as well as the proportion of the energy imports that are allocated to domestic use – but it makes a start at holding Johnson and Gove’s latest figures to account.

Here are five other ways in which leaving the EU could risk soaring energy prices:

We would have less control over EU energy policy

A new report from Chatham House argues that the deeply integrated nature of the UK’s energy system means that we couldn’t simply switch-off the  relationship with the EU. “It would be neither possible nor desirable to ‘unplug’ the UK from Europe’s energy networks,” they argue. “A degree of continued adherence to EU market, environmental and governance rules would be inevitable.”

Exclusion from Europe’s Internal Energy Market could have a long-term negative impact

Secretary of State for Energy and Climate Change Amber Rudd said that a Brexit was likely to produce an “electric shock” for UK energy customers – with costs spiralling upwards “by at least half a billion pounds a year”. This claim was based on Vivid Economic’s report for the National Grid, which warned that if Britain was excluded from the IEM, the potential impact “could be up to £500m per year by the early 2020s”.

Brexit could make our energy supply less secure

Rudd has also stressed  the risks to energy security that a vote to Leave could entail. In a speech made last Thursday, she pointed her finger particularly in the direction of Vladamir Putin and his ability to bloc gas supplies to the UK: “As a bloc of 500 million people we have the power to force Putin’s hand. We can coordinate our response to a crisis.”

It could also choke investment into British energy infrastructure

£45bn was invested in Britain’s energy system from elsewhere in the EU in 2014. But the German industrial conglomerate Siemens, who makes hundreds of the turbines used the UK’s offshore windfarms, has warned that Brexit “could make the UK a less attractive place to do business”.

Petrol costs would also rise

The AA has warned that leaving the EU could cause petrol prices to rise by as much 19p a litre. That’s an extra £10 every time you fill up the family car. More cautious estimates, such as that from the RAC, still see pump prices rising by £2 per tank.

The EU is an invaluable ally in the fight against Climate Change

At a speech at a solar farm in Lincolnshire last Friday, Jeremy Corbyn argued that the need for co-orinated energy policy is now greater than ever “Climate change is one of the greatest fights of our generation and, at a time when the Government has scrapped funding for green projects, it is vital that we remain in the EU so we can keep accessing valuable funding streams to protect our environment.”

Corbyn’s statement builds upon those made by Green Party MEP, Keith Taylor, whose consultations with research groups have stressed the importance of maintaining the EU’s energy efficiency directive: “Outside the EU, the government’s zeal for deregulation will put a kibosh on the progress made on energy efficiency in Britain.”

India Bourke is the New Statesman's editorial assistant.