Spillover Effects of Old-Age Pension Across Generations: Family Labor Supply and Child Outcomes

Katja M. Kaufmann (), Yasemin Özdemir () and Han Ye ()

CRC TR 224 Discussion Paper Series from University of Bonn and University of Mannheim, Germany

Abstract: We study the impact of grandparental retirement decisions on family members’ labor supply and child outcomes by exploiting a Dutch pension reform and a fuzzy Regression Discontinuity design. We find that a one-hour increase in grandmothers’ hours worked causes their adult daughters with young children to work 40 minutes less. Daughters without children, with older children and sons/daughters-in-law are not affected. Examining the reform impacts on grandchildren’s test scores, we find positive effects on children aged 4-7, who experienced a substitution from grandparental to maternal care. We also show negative effects for children aged 8-12, for whom grandparental childcare was substituted for by formal or no care.

Keywords: spillover effects; retirement; grandparental childcare; maternal labor supply; child development (search for similar items in EconPapers)
JEL-codes: D64 I38 J13 J22 J26 (search for similar items in EconPapers)
Pages: 99
Date: 2023-03, Revised 2025-10
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Persistent link: https://EconPapers.repec.org/RePEc:bon:boncrc:crctr224_2023_403v3

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