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Effects of Intergenerational Transfers on Elderly Coresidence with Adult Children: Evidence from Rural India

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  • Pal, Sarmistha

    (University of Surrey)

Abstract

The present paper argues that intergenerational transfers between elderly parents and adult children are important determinants of any coresidency arrangement though generally overlooked in the existing literature. In this respect the paper distinguishes between exchange of both financial and other kinds of transfers between elderly parents and adult children and then examines the effects of these transfers on coresidency taking account of the inherent endogeneity of these transfers to coresidency decision. There is evidence that the effects of transfers on coresidency arrangements could be biased if one does not correct for the endogeneity bias. The corrected estimates derived from a system of correlated and recursive system of transfers and coresidency equations suggest that the probability of coresidence is generally lower among the better off elderly; the likelihood is also lower for the older and female elderly without a spouse and also those with poor health, thus necessitating social protection for these disadvantaged elderly.

Suggested Citation

  • Pal, Sarmistha, 2007. "Effects of Intergenerational Transfers on Elderly Coresidence with Adult Children: Evidence from Rural India," IZA Discussion Papers 2847, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp2847
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    2. Xiuxia Yin & Lucille Aba Abruquah & Ya Ding, 2019. "Dynamics of Life Satisfaction Among Rural Elderly in China: The Role of Health Insurance Policies and Intergenerational Relationships," Sustainability, MDPI, vol. 11(3), pages 1-19, January.

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    More about this item

    Keywords

    co-residence with children; intergenerational transfers; elderly health and wealth effects; simultaneity bias; correlated recursive model;
    All these keywords.

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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