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The authors examined whether the provision of child care helps older adults maintain better cognitive functioning. Descriptive evidence from the Survey of Health, Ageing and Retirement in Europe (n = 5,610 women and n = 4,760 men, ages 50–80) shows that intensively engaged grandparents have lower cognitive scores than the others. The authors show that this result is attributable to background characteristics and not to child care per se. Using an instrumental variable approach, they found that providing child care has a positive effect on 1 of the 4 cognitive tests considered: verbal fluency. For the other cognitive tests, no statistically significant effect was found. Given the same level of engagement, they found very similar results for grandmothers and grandfathers. These findings point to the inclusion of grandparenting among other cognitively stimulating social activities and the need to consider such benefits when discussing the implications of this important type of nonmonetary intergenerational transfer.

In this article, we examine birth cohort differences in parents' provision of monetary help to adult children with particular focus on the extent to which cohort differences in family structure and the transition to adulthood influence these changes. Using data from the Health and Retirement Study from 1994 to 2010, we compare financial help to children of three respondent cohorts as the parents in these birth cohorts from ages 53-58 to 57-62. We find that transfers to children have increased among more recent cohorts. Two trends—declining family size and children's delay in marriage—account for part of the increase across cohorts. However, other trends, such as the increase in the number of stepchildren and increasing child's income level, tend to decrease the observed cohort trend.

This paper examines the impact of cultural norms on arrangements made for old-age support. Using data from a recent national household survey in China, I show that clan culture is significantly associated with a set of individual values about the purpose of childbearing. I then find that, among older people in rural China, clan culture is positively related to birth rates and the likelihood of having a son, coresidence with adult or married sons, and receiving financial transfers from non-coresident children. Finally, I find a significantly negative relationship between clan culture and enrollment in social pension programs. The overall results indicate that cultural norms have a significant influence on arrangements for old-age support.

Previous empirical literature on the relation between intergenerational transfer of assets and services has mostly focused on contemporary exchanges. By contrast, we provide novel evidence showing that parents who helped their adult children in the past are rewarded by higher chances of receiving informal care later in life. To this end we use Italian data containing precise retrospective information about the help with housing that couples received from their parents when they got married, such as a real estate donation or down payment. Our estimates show that this type of past help is positively associated with the current provision of informal care to the parents. This result is robust to controlling for a large set of individual and family characteristics and is only partially due to increased geographical proximity. We suggest that this finding can be explained by mixed self-interest motives, related to theories based on either bilateral exchange or the presence of a third generation (grandchildren), such as the demonstration effect model or the family constitution model.

Understanding the role of social policies in intergenerational transfers from old to young people is especially important in times of population aging. This paper focuses on the influences of social expenditures and social services on financial support and on practical help from older parents to their adult children based on the first two waves from the Survey of Health, Ageing and Retirement in Europe (SHARE, N = 60,250 dyads from 13 European countries). Multilevel models showed that social policy plays an important role for intergenerational transfer patterns: The more public assistance was provided to citizens, the more likely parents supported their adult children financially and practically, but this support was less intense in terms of money and time given. Thus, the analyses support the specialization hypothesis that posits a division of labor between family and state for downward intergenerational transfers.

Evidence from cross-sectional data reveals a negative relationship between family income and fertility. This article argues that constraints to intergenerational transfers are crucial for understanding this relationship. If parents could legally impose debt obligations on their children to recover the costs incurred in raising them, then fertility would be independent of parental income. A relationship between fertility and income arises when parents are unable to leave debts because of legal, enforcement or moral constraints. This relationship is negative when the intergenerational elasticity of substitution is larger than one, a case in which parental consumption is a good substitute for children's consumption.

Understanding the motivations behind intergenerational transfers is an important and active research area in economics. The existence and responsiveness of familial transfers have consequences for the design of intra and intergenerational redistributive programmes, particularly as such programmes may crowd out private transfers amongst altruistic family members. Yet, despite theoretical and empirical advances in this area, significant gaps in our knowledge remain. In this article, we advance the current literature by shedding light on both the motivation for providing intergenerational transfers, and on the nature of preferences for such giving behaviour, by using experimental techniques and revealed preference methods.

We study precautionary saving in a two-period model that allows for nonlinear risks and nonseparable preferences. Permitting nonlinear risk effects is important because they are common in the developing world or when worldwide shocks hit economies, like the COVID-19 pandemic. Allowing nonseparable preferences is also important because they admit the incorporation of intergenerational transfer, habit persistence and other specific features of intertemporal decision making. We decompose the risk shock using Davis’s (Int Econ Rev 30(1):131–136, 1989) compensation method and analyze the income and substitution effect of an increase in risk. We prove that the substitution effect is always negative and, therefore, the income effect must be positive and larger in size to have a precautionary net effect. We then apply the method to various sources of risk, such as income, interest rate and wealth risk. We analyze the magnitude of each effect and find the conditions required to guarantee precautionary saving in each case. Our results are presented as signs of covariances, which provides a new perspective on precautionary saving.

We present a model with altruistic parents and heterogeneous productivity. We derive two key properties for optimal estate taxation. First, the estate tax should be progressive, so that parents leaving a higher bequest face a lower net return on bequests. Second, marginal estate taxes should be negative, so that all parents face a marginal subsidy on bequests. Both properties can be implemented with a simple nonlinear tax on bequests, levied separately from the income tax. These results apply to other intergenerational transfers, such as educational investments, and are robust to endogenous fertility choices. Both estate or inheritance taxes can implement the optimal allocation, but we show that the inheritance tax has some advantages. Finally, when we impose an ad hoc constraint requiring marginal estate taxes to be nonnegative, the optimum features a zero tax up to an exemption level, and a progressive tax thereafter.

Theories of commitment, altruism, and reciprocity have been invoked to explain and describe behavior in public goods and social dilemma situations. Commitment has been used to explain behaviors like water conservation and voting. Altruism has been applied to explain contributions to charities and intergenerational transfers and bequests. Reciprocity has been invoked to explain gift exchange and labor market decisions. This paper describes a set of experiments, which distinguish between these competing theories by testing their comparative statics predictions in a linear public goods setting. Results provide strong support for reciprocity theories over either theories of commitment or of altruism. (JEL C9, D64, H41, C72)