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Private Transfers in a Cross Section of Developing Countries

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  • Donald Cox
  • Emanuela Galasso
  • Emmauel Jiminez

Abstract

Despite being well recognized by economists as an important social and economic force, private transfers are still little understood, and considerable debate surrounds basic questions, such as whether or how private and public transfers might interact. Nearly all empirical work to date has proceeded in piecemeal fashion, with evidence accruing from isolated, individual country case studies, from which generalizations are often dicey at best. We depart from this approach by focusing on a set of 11 diverse developing countries, from which private transfer information was elicited using comparable survey instruments (the World Bank’s Living Standards Measurement Surveys). We find many commonalities in private transfer patterns across countries, suggesting that part of private-behavior might emanate from basic behavioral forces shared by these diverse countries. Nowhere, for example, do private transfers seem to flow from the very poor to the very rich. We uncover intercountry differences as well. For example, in some countries, such as Kyrgyzstan, private transfers from older to younger households predominate, but in others, such as Vietnam, they mostly flow from young to old. Further, we find evidence that public and private transfers interact; private old age support tends to be smaller for countries with relatively generous public pension systems. This result has important policy implications, for it implies that the benefits of pension systems could spill over to persons whose burden of care is eased by social insurance.

Suggested Citation

  • Donald Cox & Emanuela Galasso & Emmauel Jiminez, 2006. "Private Transfers in a Cross Section of Developing Countries," Working Papers, Center for Retirement Research at Boston College wp2006-1, Center for Retirement Research, revised Jan 2006.
  • Handle: RePEc:crr:crrwps:wp2006-1
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    Cited by:

    1. Alger, Ingela & Weibull, Jörgen, 2007. "The Fetters of the Sib: Weber Meets Darwin," SSE/EFI Working Paper Series in Economics and Finance 682, Stockholm School of Economics.
    2. Jung, Juergen & Tran, Chung, 2012. "The extension of social security coverage in developing countries," Journal of Development Economics, Elsevier, vol. 99(2), pages 439-458.
    3. Dorrit Posel, 2016. "Inter-household transfers in South Africa: prevalence, patterns and poverty," SALDRU Working Papers 180, Southern Africa Labour and Development Research Unit, University of Cape Town.
    4. Alger, Ingela & Weibull, Jörgen, 2007. "Family ties, incentives and development: a model of coerced altruism," SSE/EFI Working Paper Series in Economics and Finance 681, Stockholm School of Economics.
    5. Chung Tran, 2008. "Transfers and Labor Market Behavior of the Elderly in Developing Countries: Theory and Evidence from Vietnam," Caepr Working Papers 2008-018, Center for Applied Economics and Policy Research, Economics Department, Indiana University Bloomington.
    6. Ingela Alger & Jörgen W. Weibul, 2007. "Kinship, Incentives and Evolution – revised version: Kinship, Incentives, and Evolution," Carleton Economic Papers 07-13, Carleton University, Department of Economics, revised 17 Sep 2010.

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