Skip to content
CRR logo
Submit Search
Advanced Search
Join E-mail List | Contact Us
  • Topics
  • Publications
  • Initiatives
  • Data
  • Sponsors
  • Opportunities
  • About Us
  • Search

Social Security Reform and the Exchange of Bequests for Elder Care

May 28, 2003
Share
Mobile Share Email Facebook Twitter LinkedIn

Working Paper by Meta Brown

Abstract

The majority of elderly Americans who receive long-term care outside of institutions are cared for in part by their children. We have little evidence, however, on the financial and social mechanisms securing the supply of elder care. In recent data on older U.S. families, I find that children rarely receive direct payment for their help. Further, inter-vivos transfers from unmarried parents to their adult children do not favor caregivers. Given the lack of evidence of any spotmarket for family care, the central question of this study is whether end-of-life transfers act as compensation for caregiving children. An empirical study of parents’ division of bequests and life insurance among their children shows a positive association between children’s transfer shares and both current and predicted caregiver status. In order to investigate the dependence of family care outcomes on children’s time costs and parents’ wealth and care needs, I present a dynamic model of the asset choices of an elderly parent who wishes to elicit care from her children. Model estimates indicate that children respond to parents’ care needs and bequeathable wealth in the decision to provide care, and that children with greater time costs provide care only at higher levels of bequeathable wealth. Finally, a policy simulation based on model estimates predicts that a 5 to 6 percentage point increase in the rate at which unmarried elderly parents receive family care would result from reforms in which the expected present values of both public and private pensions were included in parents’ bequests. However, a more modest change in public retirement benefits, designed to mimic the broad-brush characteristics of an existing proposal for Social Security reform, is predicted to have a negligible effect on care rates.

June,1,,2019,,Brazil.,In,This,Photo,Illustration,The,Social
June,1,,2019,,Brazil.,In,This,Photo,Illustration,The,Social
Author(s)
Headshot of Meta Brown
Meta Brown
Downloads
PDF Version
Executive Summary
Citation

Brown, . 2003. "Social Security Reform and the Exchange of Bequests for Elder Care" Working Paper 2003-12. Chestnut Hill, MA: Center for Retirement Research at Boston College.

Copy citation to clipboard
Associated Project(s)
  • BC02-S3
Topics
Social Security
Publication Type
Working Paper
Publication Number
WP#2003-12
Related Articles
iStock-1209891855

Great Recession Cut Late Boomers’ Retirement Wealth

Squared Away Blog by Kimberly Blanton

September 7, 2023
24,Hours,Delivery,Service,From,Cafes,And,Restaurants.,Takeaway,,Delivery

Workers in Nontraditional Jobs May Lack Choices

Squared Away Blog by Kimberly Blanton

August 31, 2023
A photo of a Hispanic family

The Myriad Stories Behind Hispanic Retirement Saving

Squared Away Blog by Kimberly Blanton

August 24, 2023
About us
Contact
Join e-mail list
Facebook Twitter LinkedIn YouTube RSS

© 2023 Trustees of Boston College, Center for Retirement Research|Terms of Use|Privacy Policy|Accessibility

This website uses cookies to improve your experience. We also use IP addresses, domain information and other access statistics to administer the site and analyze usage trends. If you prefer to opt out, you can select Update settings. Read our Privacy Policy. Accept
Privacy & Cookies Policy

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may have an effect on your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Non-necessary
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.
SAVE & ACCEPT