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Spillover Effects of Old-Age Pension across Generations: Family Labor Supply and Child Outcomes

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  • Kaufmann, Katja Maria

    (University of Bayreuth)

  • Özdemir, Yasemin

    (University of Bayreuth)

  • Ye, Han

    (University of Mannheim)

Abstract

We study the impact of grandparental retirement decisions on family members' labor supply and child outcomes by exploiting a Dutch pension reform in a fuzzy Regression Discontinuity design. A one-hour increase in grandmothers' hours worked causes adult daughters with young children to work half an hour less. Daughters without children, with older children and sons/daughters-in-law are not affected. We show important long-run impacts on maternal labor supply and on the child penalty. Test score effects are positive for children aged 4-7 (substitution from grandparental to maternal care), and negative for children aged 11-12 (substitution from grandparental to formal childcare).

Suggested Citation

  • Kaufmann, Katja Maria & Özdemir, Yasemin & Ye, Han, 2022. "Spillover Effects of Old-Age Pension across Generations: Family Labor Supply and Child Outcomes," IZA Discussion Papers 15388, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp15388
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    1. Karademir, Sencer & Laliberté, Jean-William & Staubli, Stefan, 2023. "The Multigenerational Impact of Children and Childcare Policies," IZA Discussion Papers 15894, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    spillover effects; retirement; grandparental childcare; maternal labor supply; child development;
    All these keywords.

    JEL classification:

    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers

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