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Parent-Child Altruism in European Countries

This paper examines the extent of altruism between parents and children in 14 EU countries using panel data evidence. Results show stronger parental altruism in Southern Europe, with fathers being more altruistic towards daughters and mothers being more altruistic towards sons.

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Parent-Child Altruism in European Countries

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  1. Mums and their Sons; Dads and their Daughters: Panel Data Evidence of Interdependent Marginal Utilities across 14 EU Countries José Alberto Molina*, María Navarro* and Ian Walker** * University of Zaragoza, Spain ** University of Warwick, UK EPUNet Conference Barcelona, May 9th 2006

  2. AIM OF THE PAPER Estimate the extent of altruism between parents and children Why? Literature: Altonji, J. , F. Hayashi, and L. Kotlikoff (AER 1992, 1995, 1996) Schwarze (2004), Schwarze and Winkelmann (2005), Winkelmann (2005)

  3. Simple Theoretical Background Data Econometric Models Results Conclusions OUTLINE

  4. Simple Theoretical Background

  5. DATA How satisfied are you with your present financial situation? - child data censored by leaving home European Community Household Panel – ECHP (1994-2001) 14 EU countries

  6. Structure of households in ECHP

  7. Mean satisfaction levels – samples with any children

  8. Mean Satisfaction Levels – comparing leavers with stayers before leaving

  9. Siblings

  10. Mean satisfaction levels – samples with 2+ children

  11. ECONOMETRIC MODELS Random Effects Ordered Probit Model Parametric Ordered Probit Model with Multiple Random Effects

  12. Altruism parameter for Fathers

  13. Altruism parameter for Mothers

  14. OTHER RESULTS Fathers less altruistic towards step children than natural - but not significant Mothers much sensitive than fathers to income shocks Married or cohabiting Mothers more income satisfied Negative effect of Family Size in income satisfaction on both Highly significantly positive effect of the household owning the house

  15. GLLAMM

  16. Estimated altruism parameters – all children

  17. Fathers money metric, Oswald (2002, 2004)

  18. Mothers money metric

  19. Estimated money measures (as % of parent income ) of the value of a 1 std dev change in child satisfaction

  20. Fathers and Mothers money (%) metric (GLLAMM)

  21. Fathers and Mothers money (%) metric (GLLAMM)

  22. CONCLUSIONS Strong parental altruism More so in Southern Europe Not religion – Ireland also low Mothers seem more altruistic than fathers Fathers seem more altruistic towards their daughters than sons Mothers seem more altruistic towards their sons in some countries but the pattern is less clear

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