Intergenerational Altruism and Transfers of Time and Money: A Life-cycle Perspective

Uta Bolt, Eric French, Jamie Hentall MacCuish and Cormac O’Dea
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Uta Bolt: University College London and Institute for Fiscal Studies
Cormac O’Dea: Yale University and Institute for Fiscal Studies
Authors registered in the RePEc Author Service: Cormac O'Dea

Working Papers from University of Michigan, Michigan Retirement Research Center

Abstract: Parental investments in children can take one of three broad forms: (1) Time investments during childhood and adolescence that aid child development, and in particular cognitive ability; (2) educational investments that improve school quality and hence educational outcomes; (3) cash investments in the form of inter vivos transfers and bequests. We develop a dynastic model of household decision-making with intergenerational altruism that nests a child production function, incorporates all three of these types of investments, and allows us to quantify their relative importance and estimate the strength of intergenerational altruism. Using British cohort data that follows individuals from birth to retirement, we ?nd that around 40% of di?erences in average lifetime income by paternal education are explained by ability at age 7, around 40% by subsequent divergence in ability and di?erent educational outcomes, and around 20% by inter vivos transfers and bequests received so far.

Pages: 47 pages
Date: 2018-04
New Economics Papers: this item is included in nep-dge, nep-ltv and nep-neu
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Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Intergenerational Altruism and Transfers of Time and Money: A Life Cycle Perspective (2023)
Working Paper: Intergenerational Altruism and Transfers of Time and Money: A Life Cycle Perspective (2023)
Working Paper: Intergenerational altruism and transfers of time and money: a life cycle perspective (2023)
Working Paper: Intergenerational Altruism and Transfers of Time and Money: A Lifecycle Perspective (2019)
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