The Impact of Employment on Parental Co-Residence

Abstract

We examine the extent to which parents use housing and shared living arrangements as a form of risk-sharing for their adult children, using detailed data on children and parents in the Health and Retirement Study for 1998–2012. On average, a young man moving from full-time to nonemployment raises the likelihood of co-residing with a parent by 1.5 percentage points; moving from full-time employment to being part-time employed raises the likelihood of co-residing with a parent by 2 percentage points. The implied elasticity of parental co-residence with respect to the son's income is -1.1; for daughters, the elasticity is -0.5.