Why Don't the Elderly Live with Their Children?: A New Look
National Bureau of Economic Research, 1988 - Older people - 36 pages
Perhaps no single statistic raises more concern about post War changes in the U.S. family than the proportion of the elderly living alone. Since 1940 the proportion of elderly living alone and in institutions has risen dramatically. While demographics appear to explain much of the change in the living arrangements of the elderly, the rising income of the elderly is viewed by many as the chief or at least a chief reason why the elderly live alone. The analyses underlying this view have not, however, considered the incomes and preferences of the children of the elderly. This paper presents a model of the joint living arrangement choice of parents and children. It then uses a new set of data to consider how the preferences and income positions of the elderly and their children influence the living arrangements of elderly parents. The findings suggest that the preferences and income levels of children may be important factors in explaining why so many of the elderly live alone
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1050 Massachusetts Avenue 1986 HRCA Survey 1986 NBER-HRCA Child 297 children Activities of Daily Andrei Shleifer baby boomer Bureau of Economic child live child's income child's preferences choose to live decision to live Economic Research elderly living elderly parents elderly with children Figure H4 or H5 health status housing services HRC elderly respondent HRCA elderly income changes income effects indicate indifferent between living KAge KEduc KMale living apart lies living with children locus logit and probit logit model married maximization maximum likelihood National Bureau NBER NBER-HRCA Child Survey nursing homes observations parent and child parent's income parents and children parents prefer Pareto efficient position from living positive H4 prefer living prefer to live probability of living probability of shared probit models reported incomes sample satisfy G(A,B shared housing shared living siblings structural model utility position values of 9 values of apXp Variable Coefficient Yp and Yc Yp Yc Probabilitv