The schooling repayment hypothesis for private transfers: evidence from the PROGRESA/Oportunidades experiment

The schooling repayment hypothesis for private transfers predicts a positive relationship between the amount of parental investment in children’s education and the amount that adult children transfer to their parents. We provide evidence on the repayment motive using data from the Mexican conditional cash transfer program PROGRESA/Oportunidades (PO). PO pays a transfer to parents for sending their children to school. Thus, if private transfers from adult children to parents are in part repayment for parental schooling investments made in the past, then PO should decrease these transfers—parents were already exogenously compensated by the government for sending their kids to school and not to work. Exploiting the exogenous variation in the amount of cash transfers a household receives from PO for sending its children to school, we compare the private transfers received in 2007 by parental households who had children 0–16 in 1997 and started receiving the programs’ benefits in 1998 with the transfers received by similar parental households who started receiving benefits in 1999. Results suggest a repayment motive exists. That is, PO is causing adult children to transfer less resources to their parents.     

Financial Attitudes and Inter vivos Resource Transfers from Older Parents to Adult Children

This exploratory study combines economic, family, and decision-making conceptual models to investigate the factors influencing resource transfers as reported by older adults. Pilot data on 61 adult children was obtained during face-to-face interviews with 18 older parents. Hierarchical multiple regressions were conducted to predict time (emotional support) and financial (cash and gifts) inter vivos transfers from demands, resources, values, and relationships. Positive health ratings, strong affection for the adult child, and money retention attitudes were associated with frequent emotional support. Small household size predicted frequent financial transfers. Results indicate the importance of values, resources, demands, and relationships in predicting resource transfers from older parent to adult child.     

WHO BENEFITS FROM CHILD BENEFIT?

Governments, over much of the developed world, make significant financial transfers to parents with dependent children. For example, in the United States the recently introduced Child Tax Credit (CTC), which goes to almost all children, costs almost $1 billion each week, or about 0.4% of GNP. The United Kingdom has even more generous transfers and spends an average of about $30 a week on each of about 8 million children—about 1% of GNP. The typical rationale given for these transfers is that they are good for our children and here we investigate the effect of such transfers on household spending patterns. In the United Kingdom such transfers, known as Child Benefit (CB), have been simple lump sum universal payments for a continuous period of more than 20 years. We do indeed find that CB is spent differently from other income—paradoxically, it appears to be spent disproportionately on adult-assignable goods. In fact, we estimate that as much as half of a marginal dollar of CB is spent on alcohol. We resolve this puzzle by showing that the effect is confined to unanticipated variation in CB so we infer that parents are sufficiently altruistic toward their children that they completely insure them against shocks.     

Financial Assistance Patterns from Midlife Parents to Adult Children: A Test of the Cumulative Advantage Hypothesis

Young adults may receive financial assistance from midlife parents as they experience life course transitions often associated with establishing independent status, such as schooling, marriage or gaining full-time work. We used longitudinal data from the Health and Retirement Study (1992–2002) and hypothesized that adult children in the United States who received repeated financial transfers from midlife parents experienced cumulative advantages across time. We also examined the data using parental household characteristics to reinforce the importance of previous transfer behaviors. We found that the receipt of prior transfers, family structure and parental household income were the strongest determinants of the odds that parents gave financial assistance to adult children as both generations aged. The findings also supported the cumulative advantage theory due to the larger likelihood of continued transfers.     

Is a good example the best sermon? Children’s imitation of parental reading

We use the last two waves of the Italian Time Use Survey to analyse whether children imitate the reading habits of their parents. As reading is crucial for continuous investment in human capital throughout a person’s life, it is important that children acquire the habit of reading. This habit may be developed through both cultural and educational transfers from parents to children, and through imitative behaviours. Imitation is of particular interest, as it suggests that parents can have a direct influence on the formation of their children’s preferences and habits, and that active policies promoting good parenting behaviours might therefore be desirable. We investigate the short-run imitative behaviour of children using a household fixed-effects model in which we identify the impact of the parents’ role model by exploiting the differences in the exposure of siblings to their parents’ example within the same household. We find robust evidence of the existence of an imitation effect: on the day of the survey, children were more likely to had read after seeing either their mother or their father reading.     

Public education provision,private schooling and income redistribution

Availability of free public education induces a transfer in kind among households with school age children. We provide evidence of the redistributive character of public education provision. We estimate structural quantile treatment effects of household income on the distribution of expected educational transfers in kind. Under the assumption that education quality is a normal good, better services (ancillary to the core education mission) supplied by private schools increase quality therein and reduce the incentives for wealthy households to enroll in public education. Because of these incentives, rich families benefit less from educational transfers in kind and the public education system is redistributive. Using household survey data from Italy, we find that an increase in net income reduces the value of the expected educational in kind transfers for compulsory education.     

Land Tenure Legacies,Household Life Cycles,and Livelihood Strategies in Upland China

Land tenure regimes shape how households use labor and other resources to construct livelihoods. Within a given tenure regime, shifting land‐labor relationships over the household life cycle present households with changing trade‐offs. In China, alongside growing market exchange of labor and produce, the legacies of land distribution following decollectivization—in particular, secure access to land and constraints on land transfers—create distinct patterns connecting livelihood strategies to household life cycles. Drawing on a household survey conducted in upland southwest China, we use latent class analysis to identify clusters of households with differing livelihood strategies. With multinomial logistic regression analyses, we evaluate the effects of household demographic composition, household resources, and community human ecological attributes on cluster membership. Households that had recently been established at the time of decollectivization have not divided their holdings. Their large labor and land endowments support diversifying strategies that include relatively large scale farming. Among other households, partitioning has yielded middle‐sized households with diversifying strategies and small households that specialize in on‐farm production or deactivate from agriculture. These clusters vary in labor exchange practices and agricultural input use. Rather than a cyclical pattern, this configuration reflects time‐bound relationships among national tenure institutions, local markets, and household processes.     

Daytime dads and do-it-all dads: Understanding lead-dad families

One of the factors that perpetuates gender inequality is the inequitable division of household labor, and particularly the division of childcare labor. Even when women are employed outside the home, many remain primarily responsible for household duties and childcare. There is little research on the household division of labor and childcare in lead-dad households. I use the term “lead dad” to refer to a father, with or without an outside job, who takes primary responsibility for the household and children. This research explores how different lead-dad households operate, examining how two types of lead-dad households handle childcare and household chores, and what this means for the mother's domestic workload. From interviews with married or cohabitating heterosexual parents of children under five where fathers do most of the childcare, I find that lead-dad households come in two forms: some dads do-it-all and some do not (daytime dads). The key difference between do-it-all dads and daytime dads is that do-it-all dads take care of almost all household chores and childcare. Meanwhile, daytime dads' primary focus is on taking care of the kids while mom is at work. However, even in households where dads “do it all,” moms are still heavily involved in the cognitive labor required to operate a household (e.g., planning playdates and scheduling summer camps). These findings have important implications for the study of the household division of labor and parenting expectations of mothers and fathers, exemplifying how gendered expectations do not necessarily swap when lead-parent roles are reversed.     

Targeting and child poverty

We examine the relative merits of targeting children within the household through price subsidies and cash transfers. To do so, we model the behavior of a household composed of one adult and one child. We then show that ‘favorable’ distortions from price subsidies may allow redistributing toward the child and then derive the conditions under which this redistributive scheme is more efficient than cash transfers. The framework is extended to account for possible paternalistic preferences of the social planner and for households composed of two adults with different preferences. Applied to a continuum of households, our approach is extended to the problem of child poverty alleviation. In contrast to the traditional view, we show that well-chosen subsidies may be more cost effective than cash transfers in reducing child poverty.     

Predicting children's savings: The role of parents' savings for transferring financial advantage and opportunities for financial inclusion

Parents transfer many forms of advantage to children based on their financial resources. Of interest is whether parents transfer educational and financial advantages and whether this occurs early in life. This paper examines financial advantage by asking whether children's own savings—apart from that of their parents—can be predicted by a separate measure of parents' savings for their child. This study predicts children's basic and college savings at ages 12 to 15 with separate samples from low-to-moderate- (LMI; N = 333) and high-income (HI; N = 411) households using Panel Study of Income Dynamics and Child Development Supplement data. Propensity score weighting and logistic regression results find that parents' savings for their child is significant in both household types. Given this, policies that aim to include children in savings may help reduce transfers of financial advantage and, ultimately, educational advantage.     

There’s no such thing as a free lunch: evidence of altruism and agency from household expenditure responses to child nutrition programs

Transfers for particular client groups such as children are often in-kind rather than cash. However, this may, at least partially, crowd out private expenditures on the goods in question because they reduce the incentive for other individuals, like parents, to make altruistic transfers. They are often made to one household member on behalf of another so there may also be agency concerns. This paper uses three nutrition programs for children in UK households to cast light on altruism and agency effects.     

Dynamics of the intergenerational transmission of welfare receipt in the United States

Using data from the Panel Study of Income Dynamics, this article expands upon earlier empirical efforts to understand intergenerational welfare participation in the United States. Empirical studies have suggested that growing up in a household that receives Aid to Families with Dependent Children (AFDC) increases the probability that a child will receive AFDC, although little insight exists on the dynamics of this relationship. In particular, no one has formally examined how the time a daughter spends on AFDC varies from the time her parents receive welfare. By observing the behavior of parents and their daughters for five years, this study examines the length of participation in AFDC across generations. The results imply that growing up in a household that receives AFDC increases the amount of time that a daughter will also receive aid, although the time a daughter receives AFDC is not affected by the length of time parents receive AFDC. His research interests include welfare programs, tax policies, local public finance, and econometrics.     

PARENTAL ALTRUISM AND SELF-INTEREST: CHILD LABOR AMONG LATE NINETEENTH-CENTURY AMERICAN FAMILIES

Intergenerational relationships within late nineteenth-century industrial families are analyzed using several large-scale, contemporary household surveys. Nonaltruistic behavior by parents was pervasive. Even among families with positive assets, child labor was common in certain industrial settings, suggesting that child labor (or nonschooling) did not simply reflect parental borrowing constraints. Neither did physical asset transfers offset human capital losses among working youth. A quantitative estimate of parental nonaltruism is derived from an equilibrium labor market model: approximately 90 percent of all child earnings was implicitly competed away through lower adult wages as families migrated to areas with abundant child labor opportunities.     

Gender and Material Transfers Between Older Parents and Children in Ismailia,Egypt

In Egypt, kin relations have been governed by a patriarchal contract, which defines expectations for intergenerational support along gendered lines. Social changes may be disrupting these customs and bringing attention to the ways gender may influence intergenerational support in rapidly changing contexts. Using data from 4,465 parent–child dyads in Ismailia, Egypt, we examined whether intergenerational material transfers favored women over men and whether gaps in needs and endowments accounted for gender differences in transfers. Fathers gave children money and goods more often than did mothers; mothers received material transfers from children more often than did fathers. Compared to sons, daughters made transfers to parents less often and received transfers from parents more often. We found residual advantages to mothers and daughters, even adjusting for differential needs and endowments. Findings corroborate persistent norms of gender complementarity, patrilocal endogamy, and reciprocation for women's caregiving, despite changes that have threatened patriarchal rules of exchange.     

Household Structure and Short‐Run Economic Change in Nicaragua

During the economic crises Nicaragua suffered between 2000 and 2002, a conditional cash transfer program targeting poor households began operating. Using panel data on 1,397 households from the program's experimentally designed evaluation, we examined the impact of the program on household structure. Our findings suggest that the program enabled households to avoid reagglomeration during the economic crises, with households in control communities growing more than treated households. These changes were driven primarily by shifts in residence of relatively young men and women with close kinship ties to the household head. In contrast, households that received transfers continued to send off young adult members, suggesting that the program provided resources to overcome the short‐term economic pressures on household structure.     

Parents' Coresidence With Adult Children: Can Immigration Explain Racial and Ethnic Variation?

There is considerable racial and ethnic variation in the prevalence of intergenerational coresidence in the United States. Using data from the Current Population Surveys, we demonstrate that much of this is attributable to recent immigration and the relative economic position of immigrant parents. Multinomial logistic regression results reveal that recent immigrant parents, particularly Asian and Central and South American immigrant parents, are more likely to live in households in which their adult children provide most of the household income. The likelihood of living in this “dependent” role decreases with duration of residence in the United States. The likelihood of living in an intergenerational household in which the parent provides the majority of the household income is not as tied to nativity.     

Parental Housing Assistance and Parent‐Child Proximity in Italy

Many studies of intergenerational exchanges include parent‐child proximity as an exogenous explanatory variable. Proximity may itself be a consequence of intergenerational resource flows, however. We analyze patterns of economic transfers between generations and their relationship to parent‐child proximity in Italy. Parental support for a child's home purchase may influence the child's choice of location, whether to facilitate parent‐child contacts, grandchild care, or parent care. We examine the situation of married couples, focusing on housing help received and the association of that help with proximity to each spouse's parents. Using 1998 survey data and multinomial logistic regression models, we find that past housing assistance has a significant effect on current proximity to each spouse's parents, controlling for parents' survival, family composition, and other factors.     

EU-Mediterranean youths in the crisis: substitution vs. income effect

The economic crisis that erupted in 2008 has had particularly adverse effects on the youth labour market outcomes in the European Union Mediterranean economies. So far little evidence is available on the reaction of the young to the adverse conditions their household members faced due to the crisis. Youths could have decided to prolong or stay in education instead of participating on the labour market (substitution effect) or they could have decided to increase their participation (income effect). By using the EU Labour Force Survey data, we explore the probability of young adults changing their labour market status from (i) inactivity to employment, (ii) inactivity to unemployment, (iii) employment to education, and (iv) unemployment to education in response to labour market outcome changes in their households: (i) both parents losing the job; (ii) one of the parents losing the job, (iii) both parents becoming inactive, (iv) one of the parents becoming inactive, and (v) both parents remaining unemployed. Estimated probit models include seven EU Mediterranean countries during the 2006–2015 period. Results support both income and substitution effect, without clear identification of the dominance of one effect over the other.     

Migrant transnationalism and the choice of transfer channels for remittances: the case of Moldova

Migrant remittances, particularly when transferred through the banking system, may contribute to financial development in migrants' home countries. We analyse the determinants of the choice of transfer channel (formal services versus informal operators or personal transfers) by Moldovan migrants in 2006. We estimate a multinomial logit model from household survey data. Our explanatory variables include socio‐economic characteristics of the migrant and other household members, the pattern of migration (destination country, legal status, duration), and financial information (average amount and frequency of payments). Key reasons not to use a formal transfer channel are a migrant's emphasis on low transfer cost (rather than speed, convenience or security), irregular legal status in the host country, and short migration spells. Our findings demonstrate that migrants' transnational capacities and activities in their entirety bear upon the choice of transfer channel; any policy interventions to promote the use of formal channels should reflect this.     

Doing Family Without Having Kids

Families that do not include children are largely overlooked by family scholars and in popular discourse. Yet this is one of several family forms that has grown in developed nations since the 1970s. As increasingly fewer adults choose to become parents, understanding the families they create, and the consequences of these family forms, will become even more important. Studies of childless adults reveal that they create bonds to fulfill many of the same functions that families with children fulfill. Research on how, and the extent to which, the childless “do” family without kids is reviewed and suggestions for future research are made.