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Compensatory inter vivos gifts

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  • Stefan Hochguertel

    (VU University Amsterdam; Tinbergen Institute, Amsterdam; and Netspar, Netherlands)

  • Henry Ohlsson

    (Department of Economics, Uppsala University, Sweden)

Abstract

Parents' transfer motives are important for understanding, e.g., macroeconomics, income (re)distribution, savings, and public finance. Using data from six biennial waves of the Health and Retirement Study 1992-2002, we estimate censored regression models with nested multilevel error components. First, we interpret our findings that inter vivos transfers from parents to children are gifts, rather than temporary help to overcome liquidity constraints. Second, inter vivos gifts are compensatory in the sense that lifetime poorer children will receive higher transfers than their lifetime richer siblings. Third, inter vivos gifts do not, however, make up the entire difference in lifetime incomes. Copyright © 2009 John Wiley & Sons, Ltd.

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Article provided by John Wiley & Sons, Ltd. in its journal Journal of Applied Econometrics.

Volume (Year): 24 (2009)
Issue (Month): 6 ()
Pages: 993-1023
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Handle: RePEc:jae:japmet:v:24:y:2009:i:6:p:993-1023

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Citations

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Cited by:
  1. Francois-Charles Wolff & Seymour Spilerman & Claudine Attias-Donfut, 2005. "Do Parents Help More their Less Well-Off Children? Evidence from a Sample of Migrants to France," Microeconomics 0504001, EconWPA.
  2. Olivera Angulo, Javier, 2008. "Motives for parental money transfers in Europe," Open Access publications from Katholieke Universiteit Leuven urn:hdl:123456789/198338, Katholieke Universiteit Leuven.
  3. Aldieri, Luigi & Fiorillo, Damiano, 2012. "Private monetary transfers and altruism: an empirical investigation on Italian families," MPRA Paper 36423, University Library of Munich, Germany.
  4. Giacomo Pasini & Rob Alessie & Viola Angelini, 2011. "Is it true love? Altruism versus exchange in time and money transfers," Working Papers 2011_27, Department of Economics, University of Venice "Ca' Foscari".
  5. Donald Cox & Beth J. Soldo, 2004. "Motivation for Money and Care that Adult Children Provide for Parents: Evidence from "Point-Blank" Survey Questions," Working Papers, Center for Retirement Research at Boston College 2004-17, Center for Retirement Research.
  6. 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).
  7. Audrey Light & Kathleen McGarry, 2003. "Why Parents Play Favorites: Explanations for Unequal Bequests," NBER Working Papers 9745, National Bureau of Economic Research, Inc.
  8. Amihai Glazer & Vesa Kanniainen & Esko Niskanen, 2001. "Bequests, Control Rights, and Cost-Benefit Analysis," CESifo Working Paper Series 576, CESifo Group Munich.
  9. Christian Dustmann & John Micklewright & Arthur Soest, 2009. "In-school labour supply, parental transfers, and wages," Empirical Economics, Springer, vol. 37(1), pages 201-218, September.
  10. 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.
  11. Olivera Angulo, Javier, 2011. "The division of parental transfers in Europe," Open Access publications from Katholieke Universiteit Leuven urn:hdl:123456789/315571, Katholieke Universiteit Leuven.
  12. Katarina Nordblom & Henry Ohlsson, 2011. "Bequests, gifts, and education: links between intergenerational transfers," Empirical Economics, Springer, vol. 40(2), pages 343-358, April.

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