Parental altruism under imperfect information: theory and evidence

Ernesto Villanueva

No 19, Working Papers from Barcelona School of Economics

Abstract: Understanding if altruism motivates intergenerational monetary transfers is crucial to assess the effectiveness of public policies that redistribute income across generations. Previous works have rejected the altruism hypothesis. This paper presents an altruism model that incorporates effort of the child and introduces imperfect information of parents about the labor market opportunities of children. Calibrations of the model show that the response of transfers to the income of the child is similar to the estimates of previous researchers. I also find evidence supporting a prediction of the model: parental transfers are especially responsive to income variations of children who are very attached to the labor market.

Keywords: altruism; imperfect information; intervivos transfers (search for similar items in EconPapers)
JEL-codes: D19 D64 D82 H20 J14 (search for similar items in EconPapers)
Date: 2015-09
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Citations: View citations in EconPapers (6)

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Related works:
Working Paper: Parental altruism under imperfect information: Theory and evidence (2002)
Working Paper: Parental altruism under imperfect information: Theory and evidence (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:bge:wpaper:19

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