Intergenerational Altruism and Retirement Transfers

ABSTRACT

I contribute new evidence on altruistic preferences in intergenerational transfers using variation in Social Security benefits induced by an inflationindexing mistake. The instrument is most relevant for those with low education, so I focus on this group. I find support for pure altruism because individuals who received additional Social Security benefits passed on 15.4 percent to children via inter vivos transfers without receiving any additional care in return. On the contrary, children reduce caregiving monotonically with increases in parental Social Security benefits. Adult female children appear to be the most affected, as they both receive monetary transfers and reduce caregiving.