Do you Care? Altruism and Inter-Generational Exchanges in Mexico

Duncan Thomas, University of California, Los Angeles

Drawing on longitudinal survey data from the Mexican Family Life Survey, we estimate models of transfers between non-coresident family members. Financial and time transfers from adults to their non-coresident parents are examined as are transfers of time and money and the inter-generational transmission of education from parents to adult children. The conceptual framework highlights the importance of individual preferences and control over decision-making. The empirical models explore the role of characteristics of each individual, his/her spouse and both their parents including indicators of relative power of each. A unique feature of the study is the inclusion of measures of preferences -- altruism, reciprocity and patience -- especially collected to exploit experimental methods from the behavioral economics/psychology literature. These methods involve subjects being given money to allocate and then paid based on those decisions. The performance of these measures in explaining inter-generational exchanges are contrasted with survey-based measures of preferences.