Public Policy and Extended Families : Evidence from Pensions in South Africa
How are resources allocated within extended families in developing economies? This question is investigated using a unique social experiment: the South African pension program. Under that program the elderly receive a cash transfer equal to roughly...
| Main Authors: | , , |
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| Format: | Journal Article |
| Language: | English en_US |
| Published: |
Washington, DC: World Bank
2014
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2003/01/17741923/public-policy-extended-families-evidence-pensions-south-africa http://hdl.handle.net/10986/17171 |
| Summary: | How are resources allocated within
extended families in developing economies? This question is
investigated using a unique social experiment: the South
African pension program. Under that program the elderly
receive a cash transfer equal to roughly twice the per
capita income of Africans in South Africa. The study
examines how this transfer affects the labor supply of
prime-age individuals living with these elderly in extended
families. It finds a sharp drop in the working hours of
prime-age individuals in these households when women turn 60
years old or men turn 65, the ages at which they become
eligible for pensions. It also finds that the drop in labor
supply is much larger when the pensioner is a woman,
suggesting an imperfect pooling of resources. The allocation
of resources among prime-age individuals depends strongly on
their absolute age and gender as well as on their relative
age. The oldest son in the household reduces his working
hours more than any other prime-age household member. |
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