Impact of intergenerational transfers on fertility
Research Article
Acknowledgments
The reported study was funded by RFBR, project number 19-310-90050
How to Cite
Babyshev V.Y. Impact of intergenerational transfers on fertility. Population. 2021. Vol. 24. No. 1. P. 77-89. DOI: https://doi.org/10.19181/population.2021.24.1.8 (in Russ.).
Abstract
On the theoretical basis of the "generational economy" the article describes the "model of overlapping generations" and "life cycle model" as the cause of the existence of intergenerational transfers. The classification of approaches to their study is carried out. Based on the exchange model (the concept of childbearing as a long-term investment in future transfers from adult children to elderly parents) and the theory of substitutions (crowding out private transfers by public social systems), the "elderly security hypothesis" is highlighted as a possible socio-economic reason for the demographic transition. Based on the works of A. Cigno, a theoretical review of this theory is made using the concepts of ^substitution effect» and «free rider effect». According to the works of R. Fenge and B. Scheubel, the "income effect" and "price effect" are defined as the key parameters for testing this hypothesis. An overview of the existing scientific and practical works on the topic of research is made, highlighting methods and results on the following examples: Italy after World War II, Germany at the turn of the 19th and 20th centuries, Brazil in 1991-2000, Hungary in 19502006, 34 OECD countries in the 1990s and the consolidated data for 121 countries at present. The author has carried out his own empirical test of the «hypothesis of elderly security» in the countries of the world on the basis of UN and OECD statistics. Coverage, social security spending, replacement rate, mandatory premium rate, and an increased risk of poverty among older people support the safe aging theory of upward intergenerational transfers from children to parents. But the internal rate of return of pension systems and the average income of older people support the competing hypothesis of top-down intergenerational transfers from parent to child. It is concluded that, with a relatively low standard of living of population, intergenerational transfers go from children to parents, but when a certain level of national welfare is reached, the movement of transfers changes to the opposite direction.
Keywords:
demographic transition, fertility, generational economy, life cycle model, intergenerational transfers, elderly security hypothesis, substitution effect, level of coverage, replacement rate, premium rate, internal rate of return
References
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4. Gladnikova E. V. Obzor podkhodov k issledovaniyu chastnykh mezhpokolennykh transfertov [Review of approaches to the study of private intergenerational transfers]. Ekonomicheskaya sotsiologiya [Economic Sociology]. 2009. No. 10(5). P. 93-110. (in Russ.)
5. Cigno A. Children and pensions. Journal of Population Economics. 1992. No. 5. P. 175-183. DOI: 10.1007/BF00172091.
6. Willis R. J. The old age security hypothesis and population growth. Demographic Behavior: Interdisciplinary Perspectives on Decision-Making. Boulder. Westview Press. 1980. 242 p. P. 43-69.
7. Zhang J., Nishimura K. The old-age security hypothesis revisited. Journal of Development Economics. 1993. No. 41(1). P. 191-202. DOI: 10.1016/0304-3878(93)90047-q.
8. Fenge R., Scheubel B. Pensions and fertility: back to the roots. Journal of Population Economics. 2017. No. 30(1). P. 93-139. DOI: 10.1007/s00148-016-0608-x.
9. Danzer A., Zyska L. Pensions and fertility: Micro-economic evidence. Available at: https://ssrn.com/abstract=3551490 (Accessed: 25 January 2021). DOI: 10.2139/ssrn.3551490.
10. Gabos A., Gal R. I., Kezdi G. The effects of child-related benefits and pensions on fertility by birth order: a test on Hungarian data. Population Studies. 2009. No. 63(3). P. 215-231. DOI: 10.1080/00324720903215293.
11. Evan T., Vozarova P. Influence of women's workforce participation and pensions on total fertility rate: a theoretical and econometric study. Eurasian Economic Review. 2018. No. 8. P. 51-72. DOI: 10.1007/s40822-017-0074-0.
12. Nagumanov K. S., Sadykov T. U. Tupiki reform solidarnoy i nakopitel'noy pensionnykh sistem i put' vykhoda iz nikh (opyt Kazakhstana) [Deadlocks of the reforms of solidary and funded pension systems and the way out of them (the experience of Kazakhstan)]. Rossiya: tendentsii i perspektivy razvitiya [Russia: Trends and Development Prospects]. Conference proceedings. Moscow. INION RAN [Institute for Scientific Information on Social Sciences RAS]. 2018. P. 675-678. (in Russ.)
13. Entwisle B. Winegarden, C. R. Fertility and Pension Programs in LDCs: A Model of Mutual Reinforcement. Economic Development and Cultural Change. 1984. No. 32(2). P. 331-354. DOI: 10.1086/451388.
14. Pensions at a Glance 2019 (OECD and G20 Indicators). OECD. Available at: https://www.oecd.org/els/oecd-pensions-at-a-glance-19991363.htm (Accessed: 25 January 2021).
Article
Received: 25.01.2021
Accepted: 24.03.2021
Citation Formats
Other cite formats:
APA
Babyshev, V. Y. (2021). Impact of intergenerational transfers on fertility. Population, 24(1), 77-89. https://doi.org/10.19181/population.2021.24.1.8
Section
DEMOGRAPHY: THEORY AND PRACTICE ISSUES
