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Financial stress, family relationships, and Australian youths’ transitions from home and school

  • Deborah Cobb-Clark


  • David Ribar


We analyze the effect of mothers’ and youths’ reports of family financial stress and relationship dissatisfaction on Australian youths’ transitions into adult roles. We find that mothers’ reports of financial stresses and borrowing constraints are associated with earlier transitions to inactivity, while youths’ reports of financial stresses are associated with earlier nest-leaving. Youths reporting unsatisfactory relationships with parents leave school and move out earlier than their peers, while unsatisfactory relationships between parents are associated with youths making later transitions. Overall, financial stress and dissatisfaction have independent associations with youths’ transitions and youths’ perspectives have different consequences to those of their mothers. Copyright Springer Science+Business Media, LLC 2012

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Article provided by Springer in its journal Review of Economics of the Household.

Volume (Year): 10 (2012)
Issue (Month): 4 (December)
Pages: 469-490

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Handle: RePEc:kap:reveho:v:10:y:2012:i:4:p:469-490
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  1. Deborah A. Cobb-Clark, 2008. "Leaving Home: What Economics Has to Say about the Living Arrangements of Young Australians," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 41(2), pages 160-176, 06.
  2. Shelly Lundberg & Jennifer Romich & Kwok Tsang, 2009. "Decision-making by children," Review of Economics of the Household, Springer, vol. 7(1), pages 1-30, March.
  3. Leslie Whittington & H. Elizabeth Peters, 1996. "Economic incentives for financial and residential independence," Demography, Springer, vol. 33(1), pages 82-97, February.
  4. Lingxin Hao & V. Joseph Hotz & Ginger Z. Jin, 2005. "Games Parents and Adolescents Play: Risky Behaviors, Parental Reputation, and Strategic Transfers," NBER Working Papers 11872, National Bureau of Economic Research, Inc.
  5. Robert Haveman & Barbara Wolfe, 1995. "The Determinants of Children's Attainments: A Review of Methods and Findings," Journal of Economic Literature, American Economic Association, vol. 33(4), pages 1829-1878, December.
  6. Pollak, Robert A, 1988. "Tied Transfers and Paternalistic Preferences," American Economic Review, American Economic Association, vol. 78(2), pages 240-44, May.
  7. McElroy, Marjorie B, 1985. "The Joint Determination of Household Membership and Market Work: The Case of Young Men," Journal of Labor Economics, University of Chicago Press, vol. 3(3), pages 293-316, July.
  8. Bruce A. Weinberg, 2001. "An Incentive Model of the Effect of Parental Income on Children," Journal of Political Economy, University of Chicago Press, vol. 109(2), pages 266-280, April.
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