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Is It True Love? Altruism Versus Exchange in Time and Money Transfers

  • Rob Alessie

    ()

  • Viola Angelini

    ()

  • Giacomo Pasini

    ()

This paper investigates what motivates intergenerational inter-vivos time and money transfers. We consider a model in which transfers may be driven not only by altruism, but also by exchange considerations. We use data from the Survey of Health, Ageing and Retirement in Europe to discriminate between the two motives. We show that both if we consider money transfers from parents to children and time transfers from children to parents, the empirical evidence rejects pure altruism in favor of exchange. This result has important policy implications on the effectiveness of formal care provision as a substitute for informal care and on the impact of taxation on transfers. Copyright Springer Science+Business Media New York 2014

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Article provided by Springer in its journal De Economist.

Volume (Year): 162 (2014)
Issue (Month): 2 (June)
Pages: 193-213

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Handle: RePEc:kap:decono:v:162:y:2014:i:2:p:193-213
Contact details of provider: Web page: http://www.springerlink.com/link.asp?id=100260

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  1. Stefan Hochguertel & Henry Ohlsson, 2009. "Compensatory inter vivos gifts," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 24(6), pages 993-1023.
  2. Alessandro Cigno, 2005. "A constitutional theory of the family," CHILD Working Papers wp14_05, CHILD - Centre for Household, Income, Labour and Demographic economics - ITALY.
  3. Maxim Engers & Steven Stern, 2002. "Long-Term Care and Family Bargaining," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 43(1), pages 73-114, February.
  4. Joseph G. Altonji & Fumio Hayashi & Laurence Kotlikoff, . "Parental Altruism and Inter Vivos Transfers: Theory and Evidence," IPR working papers 95-22, Institute for Policy Resarch at Northwestern University.
  5. Becker, Gary S, 1974. "A Theory of Social Interactions," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1063-93, Nov.-Dec..
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  7. Steven Stern & Bridget Hiedemann, 1999. "Strategic Play Among Family Members When Making Long-Term Care Decisions," Virginia Economics Online Papers 321, University of Virginia, Department of Economics.
  8. Madden, David, 2006. "Sample Selection Versus Two-Part Models Revisited: The Case of Female Smoking and Drinking," Papers HRBWP23, Economic and Social Research Institute (ESRI).
  9. Ernesto Villanueva, 2001. "Parental altruism under imperfect information: Theory and evidence," Economics Working Papers 566, Department of Economics and Business, Universitat Pompeu Fabra, revised Sep 2002.
  10. Borsch-Supan, Axel & Reil-Held, Anette, 2001. " How Much Is Transfer and How Much Is Insurance in a Pay-As-You-Go System? The German Case," Scandinavian Journal of Economics, Wiley Blackwell, vol. 103(3), pages 505-24, September.
  11. Giacomo Pasini & Rob Alessie & Viola Angelini, 2011. "Is it true love? Altruism versus exchange in time and money transfers," Working Papers 2011_27, Department of Economics, University of Venice "Ca' Foscari".
  12. Barro, Robert J, 1974. "Are Government Bonds Net Wealth?," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1095-1117, Nov.-Dec..
  13. Viola Angelini, 2007. "The strategic bequest motive: evidence from SHARE," "Marco Fanno" Working Papers 0062, Dipartimento di Scienze Economiche "Marco Fanno".
  14. Mundlak, Yair, 1978. "On the Pooling of Time Series and Cross Section Data," Econometrica, Econometric Society, vol. 46(1), pages 69-85, January.
  15. Ganzeboom, H.B.G. & de Graaf, P.M. & Treiman, D.J. & de Leeuw, J., 1992. "A standard international socio-economic index of occupational status," WORC Paper 85970031-d601-46e3-befb-1, Tilburg University, Work and Organization Research Centre.
  16. Lisa Callegaro & Giacomo Pasini, 2007. "Social interaction effects in an inter-generational model of informal care giving," Working Papers 2007_10, Department of Economics, University of Venice "Ca' Foscari".
  17. Frank A. Sloan & Jingshu Wang & Harold H. Zhang, 2002. "Upstream Intergenerational Transfers," Southern Economic Journal, Southern Economic Association, vol. 69(2), pages 363-380, October.
  18. James Poterba, 1998. "Estate and Gift Taxes and Incentives for Inter Vivos Giving in the United States," NBER Working Papers 6842, National Bureau of Economic Research, Inc.
  19. Julie Zissimopoulos & James P. Smith, 2009. "Unequal Giving: Monetary Gifts to Children Across Countries and Over Time," Working Papers 723, RAND Corporation Publications Department.
  20. Cox, Donald, 1990. "Intergenerational Transfers and Liquidity Constraints," The Quarterly Journal of Economics, MIT Press, vol. 105(1), pages 187-217, February.
  21. Arrondel, L. & Masson, A., 1999. "Family Transfers Involving Three Generations," DELTA Working Papers 1999-16, DELTA (Ecole normale supérieure).
  22. Bernheim, B Douglas & Shleifer, Andrei & Summers, Lawrence H, 1985. "The Strategic Bequest Motive," Journal of Political Economy, University of Chicago Press, vol. 93(6), pages 1045-76, December.
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  24. repec:dgr:uvatin:20070074 is not listed on IDEAS
  25. H. Elizabeth Peters & A. Sinan Unur & Jeremy Clark & William D. Schulze, 2004. "Free-Riding and the Provision of Public Goods in the Family: A Laboratory Experiment," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 45(1), pages 283-299, 02.
  26. Wolff, Francois-Charles, 2006. "Microeconomic models of family transfers," Handbook on the Economics of Giving, Reciprocity and Altruism, Elsevier.
  27. Cox, Donald, 1987. "Motives for Private Income Transfers," Journal of Political Economy, University of Chicago Press, vol. 95(3), pages 508-46, June.
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