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The Manipulation of Children's Preferences, Old-Age Support, and Investment in Children's Human Capital

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  • Gary S. Becker
  • Kevin M. Murphy
  • Jörg L. Spenkuch

Abstract

We consider the link between parents' influence over the preferences of children, parental investments in children's human capital, and children's support of elderly parents. It may pay for parents to spend resources to "manipulate" children's preferences in order to induce them to support their parents in old age. Since parents invest more in children when they expect greater support, manipulation of child preferences may end up helping children and parents. A new result, which we call the "Rotten Parent Theorem," demonstrates that if children are altruistic, then even selfish parents will make the optimal investment in their children's human capital.

Suggested Citation

  • Gary S. Becker & Kevin M. Murphy & Jörg L. Spenkuch, 2016. "The Manipulation of Children's Preferences, Old-Age Support, and Investment in Children's Human Capital," Journal of Labor Economics, University of Chicago Press, vol. 34(S2), pages 3-30.
    • Handle: RePEc:ucp:jlabec:doi:10.1086/683778
    DOI: 10.1086/683778
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    References listed on IDEAS

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