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

84 Pages Posted: 28 Jun 2022

See all articles by Katja Kaufmann

Katja Kaufmann

Johannes Gutenberg University Mainz

Yasemin Özdemir

Johannes Gutenberg University Mainz

Han Ye

University of Mannheim; IZA

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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).

Keywords: spillover effects, retirement, grandparental childcare, maternal labor supply, child development

JEL Classification: 13, J22, J26, I38, D64

Suggested Citation

Kaufmann, Katja and Özdemir, Yasemin and Ye, Han, Spillover Effects of Old-Age Pension Across Generations: Family Labor Supply and Child Outcomes. IZA Discussion Paper No. 15388, Available at SSRN: https://ssrn.com/abstract=4148133 or http://dx.doi.org/10.2139/ssrn.4148133

Katja Kaufmann (Contact Author)

Johannes Gutenberg University Mainz ( email )

Saarstr. 21
Jakob Welder-Weg 4
Mainz, 55122
Germany

Yasemin Özdemir

Johannes Gutenberg University Mainz

Saarstr. 21
Jakob Welder-Weg 4
Mainz, 55122
Germany

Han Ye

University of Mannheim ( email )

L 7, 3-5
Mannheim, 68161
Germany

IZA ( email )

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