Endogenous Co-residence and Program Incidence: South Africa's Old Age Pension

Amar Hamoudi and Duncan Thomas

No 19929, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We investigate whether living arrangements respond to an arguably exogenous shift in the distribution of power in family economic decision-making. In the early 1990s, the South African Old Age Pension was expanded to cover most black South Africans above a sex-specific age cut-off resulting in a substantial increase in the income of older South Africans and potentially their say in the economic decisions of their families. Beneficiaries of the program are more likely to coreside with adults who have less human capital as measured by height and education. Since height and education are fixed for adults, this cannot be an effect of the pension income but reflects selective changes in living arrangements resulting from the pension. The findings highlight the endogeneity of living arrangements and illustrate the potential value of moving beyond theory and data that are confined to a spatially determined definition of the household.

JEL-codes: C81 I38 J12 O12 (search for similar items in EconPapers)
Date: 2014-02
New Economics Papers: this item is included in nep-afr and nep-age
Note: DEV
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Citations: View citations in EconPapers (31)

Published as "Endogenous co-residence and program incidence: South Africa's old age pension." Journal of Development Economics, 109:30-37, 2014. PMCID: 4138532

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