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Monetary Transfers from Children and the Labour Supply of Elderly Parents: Evidence from Vietnam

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  • Nguyen, Trong-Ha

    () (University of Queensland)

  • Liu, Amy Y.C.

    () (Australian National University)

  • Booth, Alison L.

    () (Australian National University)

Abstract

In the absence of a broad-based pension scheme, the elderly in developing countries may rely on monetary transfers made by their children and on their own labour supply. This paper examines whether monetary transfers from children help to reduce elderly parents' need to work. Taking the possible endogeneity of children's transfers in the parents' labour supply into account and using maximum likelihood methods and Vietnamese data, we find that monetary transfers help the elderly cope with risks associated with old age or illness. At the same time, however, monetary transfers are not sufficient to fully substitute for parents' labour supply.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6974.

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Length: 31 pages
Date of creation: Oct 2012
Date of revision:
Publication status: published in: Journal of Development Studies, 2012, 48 (8), 1177–1191
Handle: RePEc:iza:izadps:dp6974

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Keywords: endogenous variable; inter-generational transfers; labour supply; old-age support; maximum likelihood;

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