The Effects of Income and Wealth on Time and MOney Transfers Between Parents and Children

Joseph Altonji, Fumio Hayashi and Laurence Kotlikoff

IPR working papers from Institute for Policy Resarch at Northwestern University

Abstract: We use the 1988 (Panel Study of Income Dynamics (PSID) to study the effects of income and wealth on transfers of money and time between individuals and their parents as well as the effects of incomes of other relatives on these flows. We relate the relative incomes of parents and parents in-law to transfer amounts given andreceived by married couples. We also study how the relative incomes of divorced parents influence transfers. We find that money transfers tend to reduce inequality in household incomes and that time transfers are only weakly related to income differences. Richer siblings give more to parents and receive less. Among parents and parents in-law the richer set of parents is more likely to give money and less likely to receive money. The same is true of divorced parents. In contrast to the implications of simple exchange models of transfers, there is little evidence in the cross section or in the analysis using siblings that parental income or wealth raises time transfers from children or that time transfers are exchanged for money transfers. In the cross section and among siblings, the strong negative relationship between time transfers and distance from parents is not associated with a strong negative relationship between distance and money transfers. We discuss the implications of our results for alternative models of transfers.

References: Add references at CitEc
Citations: View citations in EconPapers (44)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Working Paper: The Effects of Income and Wealth on Time and Money Transfers between Parents and Children (1996)
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:wop:nwuipr:96-5

Access Statistics for this paper

More papers in IPR working papers from Institute for Policy Resarch at Northwestern University Contact information at EDIRC.
Bibliographic data for series maintained by Thomas Krichel ().