Family Institution and Filial Attention Contract
AbstractIn this paper, we examine the pure exchange motive for intergenerational transfers within the family. We consider a model where a selfish parent offers a financial transfer in exchange for the services of the child. Using a Stackelberg game, we study the optimal attention-money contract between the generations. We prove that the amount of gift received may be either positively or negatively related with the child's income. In addition, the relationship between the two variables is non linear and affected by the parent's degree of risk aversion. This nonlinearity, which has been largely neglected to date in empirical analyses, may explain why the exchange transfer motive has received little support in developed countries.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 17713.
Date of creation: 03 Oct 2009
Date of revision:
Family; Filial Attention; Care; intergenerational Transfers; Incentives;
Find related papers by JEL classification:
- J10 - Labor and Demographic Economics - - Demographic Economics - - - General
- J19 - Labor and Demographic Economics - - Demographic Economics - - - Other
- J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
- D1 - Microeconomics - - Household Behavior
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