The Effect of Social Entitlement Programmes on Private Transfers: New Evidence of Crowding Out

26 Pages Posted: 2 Sep 2014

See all articles by Kristopher Gerardi

Kristopher Gerardi

Federal Reserve Bank of Atlanta

Yuping Tsai

Carter Consulting Inc.

Date Written: October 2014

Abstract

This paper exploits a policy experiment to identify the crowding‐out effects of public transfers on the incidence and level of private transfers. The introduction of a large social security programme in Taiwan is used to estimate the effect of an exogenous increase in government transfer payments to the elderly on the private transfer behaviour of their adult children. Using an instrumental variables strategy that accounts for the endogeneity of receiving public transfers, the empirical results show some evidence of crowding out on the extensive margin of private transfers.

Suggested Citation

Gerardi, Kristopher S. and Tsai, Yuping, The Effect of Social Entitlement Programmes on Private Transfers: New Evidence of Crowding Out (October 2014). Economica, Vol. 81, Issue 324, pp. 721-746, 2014, Available at SSRN: https://ssrn.com/abstract=2490170 or http://dx.doi.org/10.1111/ecca.12062

Kristopher S. Gerardi (Contact Author)

Federal Reserve Bank of Atlanta ( email )

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HOME PAGE: http://sites.google.com/site/kristophergerardishomepage/

Yuping Tsai

Carter Consulting Inc.

2310 Parklake Dr NE
Suite 535
Atlanta, GA 30345
United States

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