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Old-Age Support in Developing Countries: Labor Supply, Ingenerational Transfers and Living Arrangements

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  • Cameron, L.
  • Cobb-Clark, D.

Abstract

Without broad-based public pension schemes, the majority of the elderly in developing countries are left to rely on their own current and accumulated earnings and support from children as means of old-age support. We develop a cooperative bargaining model that allows us to jointly estimate the determinants of coresidency, financial transfers from non-coresiding children, and the labor-supply of elderly Indonesians. We find that many Indonesians, especially men, continue to work well into old age even if they are living with their adult children. There is little evidence that transfers are a substitute for the income support provided by the elderly parent's own labor supply. Transfers are associated with a decline in hours of work only for non-coresiding mothers. Furthermore, transfers are not strongly related to parental need or the ability of the child to give.

Suggested Citation

  • Cameron, L. & Cobb-Clark, D., 2001. "Old-Age Support in Developing Countries: Labor Supply, Ingenerational Transfers and Living Arrangements," Department of Economics - Working Papers Series 773, The University of Melbourne.
    • Handle: RePEc:mlb:wpaper:773
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    Cited by:

    1. John Gibson & Susan Olivia & Scott Rozelle, 2011. "How widespread are nonlinear crowding out effects? The response of private transfers to income in four developing countries," Applied Economics, Taylor & Francis Journals, vol. 43(27), pages 4053-4068.

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    More about this item

    Keywords

    PENSION SCHEMES ; LABOUR ; CHILDREN;
    All these keywords.

    JEL classification:

    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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