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Motives for private transfers over the life cycle: An analytical framework and evidence for Peru

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  • Cox, Donald
  • Eser, Zekeriya
  • Jimenez, Emmanuel

Abstract

This paper tests for the motives for private income transfers. We consider two motives: altruism and exchange. The question of private transfer motives is important because such motivation can influence the effects of public income transfers on the distribution of income. Using a household survey for Peru, we find that transfer amounts increase with recipient pre-transfer income, which contradicts a key prediction of the strong form of the altruism hypothesis but is consistent with exchange. We also find that capital market imperfections are likely to be an important cause for private transfers, and social security benefits "crowd out" the incidence of private transfers.
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  • Cox, Donald & Eser, Zekeriya & Jimenez, Emmanuel, 1998. "Motives for private transfers over the life cycle: An analytical framework and evidence for Peru," Journal of Development Economics, Elsevier, vol. 55(1), pages 57-80, February.
    • Handle: RePEc:eee:deveco:v:55:y:1998:i:1:p:57-80
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    More about this item

    JEL classification:

    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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