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Asset or burden? Impact of children on parents’ retirement

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  • Jeong, Su Yeon
  • Kim, Jinyoung

Abstract

If parents receive financial support in retirement from their children, having more children with higher earning power may expedite their retirement. On the other hand, retirement may be delayed if parents are burdened with educational expenses for children. We empirically investigate how the quantity and the education of children influence their parents’ retirement decisions. Due to the endogeneity of childrearing in the retirement decision, we employ the instrumental variable method with twin births and child deaths as instruments. We find that parents retire earlier when they have more children and better educated children and they receive a significant amount of transfers from children.

Suggested Citation

  • Jeong, Su Yeon & Kim, Jinyoung, 2020. "Asset or burden? Impact of children on parents’ retirement," Journal of Asian Economics, Elsevier, vol. 71(C).
    • Handle: RePEc:eee:asieco:v:71:y:2020:i:c:s1049007820301317
    DOI: 10.1016/j.asieco.2020.101251
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    More about this item

    Keywords

    Retirement; Quantity and quality of children; Old-age support;
    All these keywords.

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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