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The Manipulation of Children's Preferences, Old-Age Support, and Investment in Children's Human Capital

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  • Gary S. Becker
  • Kevin M. Murphy
  • Jörg L. Spenkuch

Abstract

We consider the link between parents' influence over the preferences of children, parental investments in children's human capital, and children's support of elderly parents. It may pay for parents to spend resources to "manipulate" children's preferences in order to induce them to support their parents in old age. Since parents invest more in children when they expect greater support, manipulation of child preferences may end up helping children and parents. A new result, which we call the "Rotten Parent Theorem," demonstrates that if children are altruistic, then even selfish parents will make the optimal investment in their children's human capital.

Suggested Citation

  • Gary S. Becker & Kevin M. Murphy & Jörg L. Spenkuch, 2016. "The Manipulation of Children's Preferences, Old-Age Support, and Investment in Children's Human Capital," Journal of Labor Economics, University of Chicago Press, vol. 34(S2), pages 3-30.
    • Handle: RePEc:ucp:jlabec:doi:10.1086/683778
    DOI: 10.1086/683778
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    References listed on IDEAS

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    Cited by:

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    2. Jeong, Su Yeon & Kim, Jinyoung, 2020. "Asset or burden? Impact of children on parents’ retirement," Journal of Asian Economics, Elsevier, vol. 71(C).
    3. Ye, Maoliang & Yi, Junjian, 2017. "Parental preferences, production technologies, and provision for progeny," Journal of Comparative Economics, Elsevier, vol. 45(2), pages 261-270.
    4. Stark, Oded, 2021. "Menopause as a regulatory device for matching the demand for children with its supply: A hypothesis," Economics & Human Biology, Elsevier, vol. 42(C).
    5. Huang, Fali & Jin, Ginger Zhe & Xu, Lixin Colin, 2017. "Love, money, and parental goods: Does parental matchmaking matter?," Journal of Comparative Economics, Elsevier, vol. 45(2), pages 224-245.
    6. Matthias Doepke & Giuseppe Sorrenti & Fabrizio Zilibotti, 2019. "The Economics of Parenting," Annual Review of Economics, Annual Reviews, vol. 11(1), pages 55-84, August.
    7. James J. Heckman & Stefano Mosso, 2014. "The Economics of Human Development and Social Mobility," Annual Review of Economics, Annual Reviews, vol. 6(1), pages 689-733, August.
    8. Bishnu, Monisankar & Garg, Shresth & Garg, Tishara & Ray, Tridip, 2023. "Intergenerational transfers: Public education and pensions with endogenous fertility," Journal of Economic Dynamics and Control, Elsevier, vol. 153(C).
    9. Rosenzweig, Mark & Zhang, Junsen, 2017. "Foreword for the symposium in honour of Gary Becker," Journal of Comparative Economics, Elsevier, vol. 45(2), pages 217-218.
    10. Gary S. Becker & Scott Duke Kominers & Kevin M. Murphy & Jörg L. Spenkuch, 2018. "A Theory of Intergenerational Mobility," Journal of Political Economy, University of Chicago Press, vol. 126(S1), pages 7-25.
    11. Ashraf, Nava & Low, Corinne & McGinn, Kathleen, 2018. "Negotiating a Better Future: How Interpersonal Skills Facilitate Inter-Generational Investment," CEPR Discussion Papers 12939, C.E.P.R. Discussion Papers.
    12. Nava Ashraf & Natalie Bau & Corinne Low & Kathleen McGinn, 2018. "Negotiating a Better Future: How Interpersonal Skills Facilitate Inter-Generational Investment," Working Papers 2018-023, Human Capital and Economic Opportunity Working Group.
    13. Huang, Fali & Jin, Ginger Zhe & Xu, Lixin Colin, 2015. "Love, money, and old age support : does parental matchmaking matter ?," Policy Research Working Paper Series 7188, The World Bank.
    14. Stark, Oded & Budzinski, Wiktor, 2023. "The demand for gratitude as a restraint on the use of child labor: A hypothesis," Journal of Demographic Economics, Cambridge University Press, vol. 89(1), pages 137-147, March.
    15. Francesconi, Marco & Heckman, James J., 2016. "Symposium on Child Development and Parental Investment: Introduction," IZA Discussion Papers 9977, Institute of Labor Economics (IZA).
    16. Avner Ben-Ner & John A. List & Louis Putterman & Anya Samek, 2015. "Learned Generosity? A Field Experiment with Parents and their Children," Working Papers 2015-12, Brown University, Department of Economics.
    17. Francesconi, Marco & Heckman, James J, 2015. "Symposium on Child Development and Parental Investment: Introduction," Economics Discussion Papers 16868, University of Essex, Department of Economics.
    18. Christine Ho, 2019. "Child’s gender, parental monetary investments and care of elderly parents in China," Review of Economics of the Household, Springer, vol. 17(3), pages 741-774, September.
    19. Belgi Turan, 2020. "Life expectancy and economic development: Evidence from microdata," Review of Development Economics, Wiley Blackwell, vol. 24(3), pages 949-972, August.
    20. Ben-Ner, Avner & List, John A. & Putterman, Louis & Samek, Anya, 2017. "Learned generosity? An artefactual field experiment with parents and their children," Journal of Economic Behavior & Organization, Elsevier, vol. 143(C), pages 28-44.
    21. Cornelissen, Thomas & Dang, Thang, 2022. "The multigenerational impacts of educational expansion: Evidence from Vietnam," Labour Economics, Elsevier, vol. 78(C).
    22. Bau, Natalie, 2019. "Can Policy Change Culture? Government Pension Plans and Traditional Kinship Practices," CEPR Discussion Papers 13486, C.E.P.R. Discussion Papers.
    23. Xu Lixin Colin, 2016. "Cheung, Becker and Marriage," Man and the Economy, De Gruyter, vol. 3(1), pages 65-76, June.

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