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A Matching Model of Co-Residence with a Family Network: Empirical Evidence from China

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  • Naijia Guo
  • Xiaoyu Xia
  • Junsen Zhang

Abstract

We develop a co-residence model between young adults and the elderly as an application of the Shapley–Shubik–Becker bilateral matching framework. This model captures competition between adult children and between parents and parents-in-law. Using microdata from China, we estimate our model by using a network simulation method to fill in partially unobservable marriage links. We find that our model explains the child-side and parent-side competitions observed in the data better than two alternative multinomial logit models with only one-sided competition. In addition, counterfactual experiments quantify the effects of changes in the one-child policy and housing prices on intergenerational co-residence.

Suggested Citation

  • Naijia Guo & Xiaoyu Xia & Junsen Zhang, 2022. "A Matching Model of Co-Residence with a Family Network: Empirical Evidence from China," The Economic Journal, Royal Economic Society, vol. 132(648), pages 2873-2917.
    • Handle: RePEc:oup:econjl:v:132:y:2022:i:648:p:2873-2917.
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    File URL: http://hdl.handle.net/10.1093/ej/ueac043
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