We investigate long-run effects of World War II on socioeconomic status and health of older individuals in Europe. We analyze data from SHARELIFE, a retrospective survey conducted as part of SHARE in Europe in 2009. SHARELIFE provides detailed data on events in childhood during and after the war for over 20,000 individuals in thirteen European countries. We construct several measures of war exposure: experience of dispossession, persecution, combat in local areas, and hunger periods. Exposure to war and, more important, to individual-level shocks caused by the war significantly predicts economic and health outcomes at older ages.

This paper examines impacts of childhood health on socioeconomic status (SES) outcomes observed during adulthood: levels and trajectories of education, family income, household wealth, individual earnings, and labor supply. The analysis is conducted using panel data that collect these SES measures using a sample who were originally children and are now well into their adult years. Since all siblings are in the panel, unmeasured family and neighborhood background effects can be controlled for. With the exception of education, poor childhood health has a quantitatively large effect on all of these outcomes. Moreover, these estimated effects are larger when unobserved family effects are controlled.

Using a unique set of household-level panel data, we estimate the effect of capital gains on saving by asset type, controlling for observable and unobservable household-specific fixed effects. The results suggest that the decline in the personal saving rate since 1984 is largely due to the significant capital gains in corporate equities experienced over this period. Over 5-year periods, the effect of capital gains in corporate equities on saving is substantially larger than the effect of capital gains in housing or other assets. Failure to differentiate wealth effects across asset types results in a significant understatement of their size.