IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

A Theory of Educational Inequality Family and Agency Costs

  • Jellal, Mohamed

In this paper, we examine the consequences of imperfect information on the pattern of transfers from parents to children. Drawing on the theory of mechanism design, we consider a model of family contract with two levels of effort. We prove that equal transfers among children are expected under perfect information, while the second-best contract implies risksharing between the two generations, so that poor families experience higher agency costs..

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
File Function: original version
Download Restriction: no

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 17434.

in new window

Date of creation: 21 Sep 2009
Date of revision:
Handle: RePEc:pra:mprapa:17434
Contact details of provider: Postal:
Ludwigstraße 33, D-80539 Munich, Germany

Phone: +49-(0)89-2180-2459
Fax: +49-(0)89-2180-992459
Web page:

More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Shleifer, Andrei & Summers, Lawrence H. & Bernheim, B. Douglas, 1986. "The Strategic Bequest Motive," Scholarly Articles 3721794, Harvard University Department of Economics.
  2. Eli Feinerman & Edward J. Seiler, 2002. "Private transfers with incomplete information: A contribution to the "altruism-exchange motivation for transfers" debate," Journal of Population Economics, Springer;European Society for Population Economics, vol. 15(4), pages 715-736.
  3. Gatti, Roberta, 2000. "Family altruism and incentives," Policy Research Working Paper Series 2505, The World Bank.
  4. Cox, Donald, 1987. "Motives for Private Income Transfers," Journal of Political Economy, University of Chicago Press, vol. 95(3), pages 508-46, June.
  5. Ana Fernandes, 2000. "Altruism with Endogenous Labor Supply," Econometric Society World Congress 2000 Contributed Papers 0844, Econometric Society.
  6. Bisin, Alberto & Verdier, Thierry, 2001. "The Economics of Cultural Transmission and the Dynamics of Preferences," Journal of Economic Theory, Elsevier, vol. 97(2), pages 298-319, April.
  7. Assar Lindbeck & Sten Nyberg, 2006. "Raising Children to Work Hard: Altruism, Work Norms, and Social Insurance," The Quarterly Journal of Economics, Oxford University Press, vol. 121(4), pages 1473-1503.
  8. Ernesto Villanueva, 2003. "Parental altruism under imperfect information: theory and evidence," Working Papers 19, Barcelona Graduate School of Economics.
  9. Luc Arrondel & André Masson, 2002. "Altruism, Exchange or Indirect Reciprocity: What do the Data on Family Transfers Show?," DELTA Working Papers 2002-18, DELTA (Ecole normale supérieure).
  10. Ermisch, John & Di Salvo, Pamela, 1997. "The Economic Determinants of Young People's Household Formation," Economica, London School of Economics and Political Science, vol. 64(256), pages 627-44, November.
  11. Chami, Ralph, 1996. "King Lear's dilemma: Precommitment versus the last word," Economics Letters, Elsevier, vol. 52(2), pages 171-176, August.
  12. Wilhelm, Mark O, 1996. "Bequest Behavior and the Effect of Heirs' Earnings: Testing the Altruistic Model of Bequests," American Economic Review, American Economic Association, vol. 86(4), pages 874-92, September.
  13. 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.
  14. Wolff François-Charles & Barnet-Verzat Christine, 2003. "Labor opportunities against family intergenerational exchange," Economics Bulletin, AccessEcon, vol. 10(1), pages 1-7.
  15. Helmuth Cremer & Pierre Pestieau, 1996. "Bequests as a heir "discipline device"," Journal of Population Economics, Springer;European Society for Population Economics, vol. 9(4), pages 405-414.
  16. 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..
  17. Kathleen McGarry, 1997. "Inter vivos Transfers and Intended Bequests," NBER Working Papers 6345, National Bureau of Economic Research, Inc.
  18. Lundholm, Michael & Ohlsson, Henry, 2000. "Post mortem reputation, compensatory gifts and equal bequests," Economics Letters, Elsevier, vol. 68(2), pages 165-171, August.
  19. Barnet-Verzat, Christine & Wolff, Francois-Charles, 2002. "Motives for pocket money allowance and family incentives," Journal of Economic Psychology, Elsevier, vol. 23(3), pages 339-366, June.
  20. Lam, D. & Schoeni, R.F., 1993. "Private Interhousehold Transfers of Money and Time: New Empirical Evidence," Papers 93-26, RAND - Labor and Population Program.
  21. Chami, Ralph, 1998. "Private Income Transfers and Market Incentives," Economica, London School of Economics and Political Science, vol. 65(260), pages 557-80, November.
  22. Wolff, Francois-Charles, 2006. "Microeconomic models of family transfers," Handbook on the Economics of Giving, Reciprocity and Altruism, Elsevier.
  23. Gary Chamberlain, 1980. "Analysis of Covariance with Qualitative Data," Review of Economic Studies, Oxford University Press, vol. 47(1), pages 225-238.
  24. Donald Cox, 1990. "Intergenerational Transfers and Liquidity Constraints," The Quarterly Journal of Economics, Oxford University Press, vol. 105(1), pages 187-217.
  25. Furnham, Adrian, 1999. "The saving and spending habits of young people," Journal of Economic Psychology, Elsevier, vol. 20(6), pages 677-697, December.
  26. Jellal, Mohamed & Wolff, François Charles, 2003. "Leaving home as a self-selection device," MPRA Paper 38528, University Library of Munich, Germany.
  27. repec:ebl:ecbull:v:10:y:2003:i:1:p:1-7 is not listed on IDEAS
  28. Furnham, Adrian, 2001. "Parental attitudes to pocket money/allowances for children," Journal of Economic Psychology, Elsevier, vol. 22(3), pages 397-422, June.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:17434. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joachim Winter)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.