Do Private Household Transfers to the Elderly Respond to Public Pension Benefits? Evidence from Rural China

Plamen Nikolov and Alan Adelman ()
Additional contact information
Alan Adelman: State University of New York

No 12532, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Aging populations in developing countries have spurred the introduction of public pension programs to preserve the standard of living for the elderly. The often-overlooked mechanism of intergenerational transfers, however, can dampen these intended policy effects, as adult children who make income contributions to their parents could adjust their behavior in response to changes in their parents' income. Exploiting a unique policy intervention in China, we examine using a difference-in-difference-in-differences (DDD) approach how a new pension program impacts inter vivos transfers. We show that pension benefits lower the propensity of adult children to transfer income to elderly parents in the context of a large middle-income country, and we also estimate a small crowd-out effect. Taken together, these estimates fit the pattern of previous research in high-income countries, although our estimates of the crowd-out effect are significantly smaller than previous studies in both middle- and high-income countries.

Keywords: crowd-out effect; developing countries; life cycle; retirement; pension; inter vivos transfers; middle-income countries; China; aging (search for similar items in EconPapers)
JEL-codes: D64 H55 J14 J22 O15 O16 R2 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2019-08
New Economics Papers: this item is included in nep-cna
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Published - published in: Journal of the Economics of Ageing, 2019, 14, 100204

Downloads: (external link)
https://docs.iza.org/dp12532.pdf (application/pdf)

Related works:
Working Paper: Do Private Household Transfers to the Elderly Respond to Public Pension Benefits? Evidence from Rural China (2020)
Journal Article: Do private household transfers to the elderly respond to public pension benefits? Evidence from rural China (2019)
Working Paper: Do Private Household Transfers to the Elderly Respond to Public Pension Benefits? Evidence from Rural China (2019)
Working Paper: Do Private Household Transfers to the Elderly Respond to Public Pension Benefits? Evidence from Rural China (2019)
Working Paper: Do Private Household Transfers to the Elderly Respond to Public Pension Benefits? Evidence from Rural China (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp12532

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().