Dynastic Precautionary Savings

• 成果类型: Article
• 署名作者: Boar, Corina
• 署名单位: New York University
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1093/restud/rdab012
• 发表日期: 2021
• 页码: 2735-2765
• 关键词: life-cycle; income shocks; consumption; insurance; RISK; transfers; expenses

摘要

This article documents that parents accumulate savings to insure their children against income risk. I refer to this behaviour as dynastic precautionary saving. Using a sample of matched parent-child pairs from the Panel Study of Income Dynamics, I test for dynastic precautionary savings by examining the response of parental consumption to the child's permanent income uncertainty. I exploit variation in permanent income risk across age and industry-occupation groups to confirm that, all else equal, higher uncertainty in the child's permanent income depresses parental consumption, indicating a precautionary saving motive across generations.