Eric French, University College London
Intergenerational Altruism and Transfers of Time and Money: A Lifecycle Perspective
Abstract
Parental investments in children can take one of three broad forms: (1) Time investments during childhood and adolescence that aid child development, and in particular cognitive ability; (2) educational investments that improve school quality and hence educational outcomes; (3) cash investments in the form of inter vivos transfers and bequests. We develop a dynastic model of household decision-making with intergenerational altruism that nests a child production function, incorporates all three of these types of investments, and allows us to quantify their relative importance and estimate the strength of intergenerational altruism. Using British cohort data that follows individuals from birth to retirement, we find that around 40% of differences in average lifetime income by paternal education are explained by ability at age 7, around 40% by subsequent divergence in ability and different educational outcomes, and around 20% by inter vivos transfers and bequests received so far.
Eric French is a professor in the Economics Department at UCL, and is also senior economist and research advisor on the microeconomics team in the economic research department at the Federal Reserve Bank of Chicago. French's research focus is in the areas of econometrics, labor, public and health economics.
French's research has been published in Econometrica, the Review of Economic Studies, Review of Economics and Statistics, theJournal of Labor Economics, Journal of Applied Econometrics, American Economic Review, Journal of Political Economy,Handbook of Labor Economics and Journal of Human Resources.
He has taught at the Department of Economics and the Business School at Northwestern University. French received a B.A. in economics from the University of California–Berkeley, and M.S. and Ph.D. degrees in economics from the University of Wisconsin