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Family Transfers Involving Three Generations

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Author Info
Arrondel, Luc
Masson, Andre

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Abstract

Most models of family transfers consider only two generations and focus on two motives: altruism and exchange. They also assume perfect substitution between inter-vivos downward transfers and bequests. Based on French evidence, we show that parent-to-child transfers belong to three distinct categories (investment in child's education, financial assistance, wealth transmission), and advocate a three-generation framework. Thus, transfer behavior of parents toward their children is strongly influenced by the behavior of their own parents. There is also some evidence of the Cox and Stark demonstration effect: parents help their own parents, expecting to receive comparable support from their children. Such behavior can be regarded as indirect reciprocity: the beneficiary does not give back to the initial giver but to a third person of another generation. Copyright 2001 by The editors of the Scandinavian Journal of Economics.

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Article provided by Blackwell Publishing in its journal Scandinavian Journal of Economics.

Volume (Year): 103 (2001)
Issue (Month): 3 (September)
Pages: 415-43
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Handle: RePEc:bla:scandj:v:103:y:2001:i:3:p:415-43

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  1. Miguel Angel Barberán Lahuerta, 2006. "Redistribution and progressivity of taxes on inheritances and donations and analysis with data of panel," Hacienda Pública Española, IEF, vol. 177(2), pages 25-55, April. [Downloadable!]
  2. Joaquín Andaluz & Miriam Marcén & José Alberto Molina, 2007. "Income Transfers, Welfare and Family Decisions," IZA Discussion Papers 2804, Institute for the Study of Labor (IZA). [Downloadable!]
  3. Eric Bonsang, 2007. "How do middle-aged children allocate time and money transfers to their older parents in Europe?," Empirica, Springer, vol. 34(2), pages 171-188, April. [Downloadable!] (restricted)
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  4. Nordblom, Katarina & Ohlsson, Henry, 2002. "BEQUESTS, GIFTS, AND EDUCATION Swedish evidence on parents’ transfer behavior," Working Papers in Economics 69, Göteborg University, Department of Economics. [Downloadable!]
  5. Leif Andreassen, 2004. "Mortality, fertility and old age care in a two-sex growth model," Discussion Papers 378, Research Department of Statistics Norway. [Downloadable!]
  6. Kirchsteiger, Georg & Sebald, Alexander, 2006. "Investments into Education - Doing as the Parents Did," CEPR Discussion Papers 5686, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  7. Luc Arrondel & André Masson, 2002. "Altruism, Exchange or Indirect Reciprocity: What do the Data on Family Transfers Show?," DELTA Working Papers 2002-18, DELTA (Ecole normale supérieure). [Downloadable!]
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  8. Partha Deb & Cagla Okten & Una Okonkwo Osili, 2002. "Giving to Family versus Giving to the Community Within and Across Generations," Hunter College Department of Economics Working Papers 02/6, Hunter College: Department of Economics. [Downloadable!]
  9. André Masson, 2001. "Economie du débat intergénérationnel. Points de vue normatif, comptable, politique," DELTA Working Papers 2001-07, DELTA (Ecole normale supérieure). [Downloadable!]
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