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Transfer behavior in the Health and Retirement Study: measurement and the redistribution of resources within the family.(Special Issue: The Health and Retirement Study Data Quality and Early Results)

Recent work by a number of economists has opened a debate about the role played by intergenerational transfers. Using the new Health and Retirement Study (HRS), we are better able to address the issues involved. Contrary to the current literature on bequests, we do not find that parents give transfers equally to all children. Rather, we find that in the case of inter-vivos transfers, respondents give greater financial assistance to their less well off children than to their children with higher incomes. Financial transfers to elderly parents are also found to be negatively related to the (potential) recipient's income. These results hold both for the incidence of transfers and for the amounts. In addition, we allow for unobserved differences across families by estimating fixed effect models and find our results to be robust to these specifications. A comparison of the HRS transfer data to other survey data demonstrates that the HRS is potentially quite useful for research on transfer behavior.