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Intergenerational Precautionary Savings in Europe

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  • Francesco Scervini
  • Serena Trucchi

Abstract

In this paper, we study whether precautionary saving motives have an intergenerational component; namely whether and to what extent the income uncertainty of younger generations affects the savings of their parents. To this end, we exploit a cross‐country European longitudinal household dataset collecting information on parents and their offspring, augmented with indicators for their offspring's income risk. We find that savings significantly respond to changes in income risk, also across generations. This finding is robust to several checks and displays heterogeneity across countries, which is consistent with substitutability between private and public insurance tools.

Suggested Citation

  • Francesco Scervini & Serena Trucchi, 2022. "Intergenerational Precautionary Savings in Europe," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 84(2), pages 427-450, April.
    • Handle: RePEc:bla:obuest:v:84:y:2022:i:2:p:427-450
    DOI: 10.1111/obes.12461
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    1. Yang, Siqiang & Ripoll, Marla, 2023. "Financial transfers from parents to adult children," Journal of Economic Behavior & Organization, Elsevier, vol. 208(C), pages 286-303.

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    More about this item

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • D15 - Microeconomics - - Household Behavior - - - Intertemporal Household Choice; Life Cycle Models and Saving
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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