Dynamics and Determinants of Family Transfers

For older adults with limited access to social security and pension savings, children assume the role of providers of financial resources and personal care, among other types of family transfers. This is the case for many older adults in the developing world as well as for those in developed countries who become vulnerable during periods of economic downturn. This and the ongoing demographic transition towards old age common to many developing and most developed nations, raise questions about the interactions between policies and the increased involvement of children in their parent's income security and well being. This dissertation studies the case of Mexico to address some of these concerns. Several features make lessons from this country relevant. First, in Mexico children are one of the main sources of income for older adults. Second, the country's demographic transition will shift the proportion of adults 60 and older from 8 percent of the total population in 2005 to 27 percent in 2050, increasingly requiring involvement from children to provide for their parents, an issue made worse by the limited coverage of the social security and pension systems. One of the main long term risks in this is that Mexico, as well as other countries and populations under similar circumstances, could be facing another mechanism of intergenerational transmission of poverty as the number of older adults increases. From a policy perspective, concerns rise about the way in which public programs affect private mechanisms of support. The three aims of this dissertation address different aspects on these regards.