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Intergenerational transfers within the family and the role for old age survival

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  • Fanny A. Kluge

    (Max Planck Institute for Demographic Research, Rostock, Germany)

  • Tobias C. Vogt

    (Max Planck Institute for Demographic Research, Rostock, Germany)

Abstract

In this paper, we study the relationship between income and old age survival via the indirect pathway of private transfers. Our analysis focuses on intergenerational transfers in the family as an important, but so far less investigated, link between income and improved old age survival. We use an agent based model to simulate an exchange relationship between two generations in a family and incorporate realistic demographic, economic and time use data for Germany. We find that older parents transfer increasing shares of their pensions to their offspring and receive informal care or emotional support in return. This exchange motive is mutually beneficial as younger generations are in greater need for financial subsidies and older ones for contact and care. Our inductive approach adds to our understanding how income is spread in the family and how older family members can benefit from an exchange of money for care.

Suggested Citation

  • Fanny A. Kluge & Tobias C. Vogt, 2020. "Intergenerational transfers within the family and the role for old age survival," MPIDR Working Papers WP-2020-021, Max Planck Institute for Demographic Research, Rostock, Germany.
    • Handle: RePEc:dem:wpaper:wp-2020-021
    DOI: 10.4054/MPIDR-WP-2020-021
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    References listed on IDEAS

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    JEL classification:

    • J1 - Labor and Demographic Economics - - Demographic Economics
    • Z0 - Other Special Topics - - General

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