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Intergenerational Precautionary Saving in Europe

Author

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  • Francesco Scervini

    (Department of Economics, University of Pavia)

  • Serena Trucchi

    (Department of Economics, Ca' Foscari University of Venice)

Abstract

This paper examines the interaction between altruism towards offspring and precautionary savings. It investigates whether increased uncertainty in children labor income fosters savings of parents. We first construct a two-periods and two-generations model, to underline which are the mechanisms behind the intergenerational precautionary motive for savings. Second, we exploit two micro datasets to test the main theoretical implications. Parents' consumption turns out to respond to the offspring's income risk. This result is robust to the presence of family fixed effects and to many alternative empirical specifications.

Suggested Citation

  • Francesco Scervini & Serena Trucchi, 2019. "Intergenerational Precautionary Saving in Europe," Working Papers 2019:13, Department of Economics, University of Venice "Ca' Foscari".
    • Handle: RePEc:ven:wpaper:2019:13
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    References listed on IDEAS

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    2. Yang, Siqiang & Ripoll, Marla, 2023. "Financial transfers from parents to adult children," Journal of Economic Behavior & Organization, Elsevier, vol. 208(C), pages 286-303.

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    More about this item

    Keywords

    Precautionary savings; consumption; income risk; offspring;
    All these keywords.

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • D15 - Microeconomics - - Household Behavior - - - Intertemporal Household Choice; Life Cycle Models and Saving
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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