Review of Economics of the Household

, Volume 13, Issue 2, pp 359–384 | Cite as

Grandchild care, intergenerational transfers, and grandparents’ labor supply

  • Christine Ho


One-fifth of children aged below five with employed mothers benefit from grandparent provided child care as their main source of daycare in the US. Using data from the health and retirement study, we investigate how grandchild care needs relate to intergenerational transfers of time and money and grandparents’ labor supply behavior. We find that grandparents with a new born grandchild are more likely to provide grandchild care while married grandparents are also more likely to be employed and provide financial help. Grandparents with grandchildren living close by provided higher time transfers while married grandmothers with resident grandchildren also worked longer hours.


Grandchild care Intergenerational transfers Grandparents’ labor supply 

JEL Classifications

D13 J13 J14 J22 



I would like to thank James Banks, Samuel Belinsky, Soshana Grossbard, Hilary Hoynes, Kathleen McGarry, Costas Meghir, Nicola Pavoni, Ian Preston, Ken Yamada, and two anonymous reviewers for insightful comments and suggestions. All mistakes remain my own.


  1. Andreoni, J. (1989). Giving with impure altruism: Applications to charity and Ricardian equivalence. Journal of Political Economy, 97(6), 1447–1458.CrossRefGoogle Scholar
  2. Arrondel, L., & Masson, A. (2006). Altruism, exchange or indirect reciprocity: What do the data on family transfers show? Handbook of the Economics of Giving, Altruism and Reciprocity, 2, 971–1053.CrossRefGoogle Scholar
  3. Baker, L. A., & Silverstein, M. (2008). Depressive symptoms among grandparents raising grandchildren: The impact of participation in multiple roles. Journal of Intergenerational Relationships, 6(3), 285–304.CrossRefGoogle Scholar
  4. Barro, R. J. (1974). Are government bonds net wealth? Journal of Political Economy, 82(6), 1095–1117.CrossRefGoogle Scholar
  5. Becker, G. S. (1974). A theory of social interactions. Journal of Political Economy, 82(6), 1063–1093.CrossRefGoogle Scholar
  6. Bengtson, V. (2001). Beyond the nuclear family: The increasing importance of multigenerational bonds. Journal of Marriage and Family, 63(1), 1–16.CrossRefGoogle Scholar
  7. Bernheim, D. B., Shleifer, A., & Summers, L. H. (1985). The strategic bequest motive. Journal of Political Economy, 93(6), 1045–1076.CrossRefGoogle Scholar
  8. Bianchi, S., Seltzer, J., Song, X., & Schoeni, R. (2012). Money and time transfers from parents to adult children in the United States: New evidence on between and within family differences from the June 2012 survey of consumers. Manuscript. Google Scholar
  9. Brown, M. (2005). Informal care and the division of end-of-life transfers. Journal of Human Resources, 41(1), 191–219.Google Scholar
  10. Cardia, E., & Ng, S. (2003). Intergenerational time transfers and child care. Review of Economic Dynamics, 6, 431–454.CrossRefGoogle Scholar
  11. Compton, J. (2013). Family proximity and the labor force status of women in Canada. Review of Economics of the Household,. doi: 10.1007/s11150-013-9179-8.Google Scholar
  12. Compton, J., & Pollak, R. A. (2013). Family proximity, childcare and women’s labor force attachment. Journal of Urban Economics.  10.1016/j.jue.2013.03.00.
  13. Cox, D. (1987). Motives for private income transfers. Journal of Political Economy, 95(3), 508–546.CrossRefGoogle Scholar
  14. Cox, D., & Rank, M. R. (1992). Inter vivos transfers and intergenerational exchange. The Review of Economics and Statistics, 74(2), 305–314.CrossRefGoogle Scholar
  15. Del Boca, D. (2002). The effect of child care and part time opportunities on participation and fertility decisions in Italy. Journal of Population Economics, 15(3), 549–573.CrossRefGoogle Scholar
  16. Fuller-Thomson, E., & Minkler, M. (2000). The mental and physical health of grandmothers who are raising their grandchildren. Journal of Mental Health and Aging, 6, 311–323.Google Scholar
  17. Ho, C. (2012). Optimal disability insurance with informal child care. Centre for Silver Security WP CSS-WP-04-201.Google Scholar
  18. Ho, C. (2013). Welfare-to-work reform and intergenerational support: A look at elderly women’s response to the 1996 PRWORA. Manuscript.Google Scholar
  19. Ho, C., & Pavoni, N. (2012). The joint design of Social Security and unemployment insurance. Manuscript.Google Scholar
  20. Hughes, M. E., Waite, L. J., La Pierre, T. A., & Luo, Y. (2007). All in the family: The impact of caring for grandchildren on grandparents’ health. Journal of Gerontology, 62(2), S108–S199.CrossRefGoogle Scholar
  21. Jendrek, M. P. (1993). Grandparents who parent their grandchildren: Effects on lifestyle. Journal of Marriage and the Family, 55(3), 609–621.CrossRefGoogle Scholar
  22. Laferrère, A., & Wolff, F.-C. (2006). Microeconomic models of family transfers. Handbook of the Economics of Giving, Altruism and Reciprocity, 2, 889–969.CrossRefGoogle Scholar
  23. Laughlin, L. (2010). Who’s minding the kids? Child care arrangements. US Census Bureau. Google Scholar
  24. Lei, X. (2008). Grandchild care, financial transfers and grandma’s labor market decisions. Manuscript.Google Scholar
  25. Leibowitz, A., Klerman, J. A., & Waite, L. J. (1992). Employment of new mothers and child care choice. Journal of Human Resources, 27(1), Special Issue on Child Care, 112–133.Google Scholar
  26. López-Anuarbe, M. (2013). Intergenerational transfers in long term care. Review of Economics of the Household, 11, 235–258.CrossRefGoogle Scholar
  27. Maestas, N. (2010). Back to work: Expectations and realizations of work after retirement. Journal of Human Resources, 45(3), 718–748.CrossRefGoogle Scholar
  28. Maurer-Fazio, M., Connelly, R., Chen, L., & Tang, L. (2011). Childcare, eldercare and labor force participation of married women in urban China, 1982–2000. Journal of Human Resources, 46(2), 261–294.CrossRefGoogle Scholar
  29. McGarry, K., & Schoeni, R. F. (1995). Transfer behavior in the health and retirement study: measurement and the distribution of resources within the family. Journal of Human Resources, 30, Special Issue on Health and Retirement Study, S184–S226.Google Scholar
  30. Minkler, M., & Fuller-Thomson, E. (2001). Physical and mental health status of American grandparents providing extensive child care to their grandchildren. Journal of the American Medical Women’s Association, 56(4), 199–205.Google Scholar
  31. Pezzin, L. E., Pollak, R., & Schone, B. S. (2007). Efficiency in family bargaining: living arrangements and caregiving decisions of adult children and disabled elderly parents. CESifo Economic Studies, 53(1), 69–96.CrossRefGoogle Scholar
  32. Pezzin, L. E., Pollak, R., & Schone, B. S. (2009). Long-term care of the disabled elderly: Do children increase caregiving by spouses? Review of Economics of the Household, 7, 323–339.CrossRefGoogle Scholar
  33. Pezzin, L. E., & Schone, B. S. (1999). Intergenerational household formation, female labor supply and informal caregiving: A bargaining approach. Journal of Human Resources, 34(3), 475–503.CrossRefGoogle Scholar
  34. Posadas, J., & Vidal-Fernández, M. (2012). Grandparent’s childcare and female labor force participation. IZA discussion paper no. 6398.Google Scholar
  35. Reinkowski, J. (2013). Should we care that they care? Grandchild care and its impact on grandparent health. Ifo working paper no. 165.Google Scholar
  36. Rosenzweig, M. R., & Wolpin, K. I. (1994). Parental and public transfers to young women and their children. American Economic Review, 84(5), 1195–1212.Google Scholar
  37. Sasaki, M. (2002). The causal effect of family structure on labor force participation among Japanese married women. Journal of Human Resources, 37(2), 429–440.CrossRefGoogle Scholar
  38. Schoeni, R. F. (2002). Does unemployment insurance displace familial assistance? Public Choice, 110, 99–119.CrossRefGoogle Scholar
  39. Soldo, B. J., & Hill, M. S. (1995). Family structure and transfer measures in the health and retirement study: Background and overview. Journal of Human Resources, 30, Special Issue on Health and Retirement Study, S108–S137.Google Scholar
  40. Ying, W., & Marcotte, D. E. (2007). Golden years? The labor market effects of caring for grandchildren. Journal of Marriage and Family, 69, 1283–1296.CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media New York 2013

Authors and Affiliations

  1. 1.School of EconomicsSingapore Management UniversitySingaporeSingapore

Personalised recommendations