Rearranging the Family? Income Support and Elderly Living Arrangements in a Low Income Country

Eric Edmonds, Kristin Mammen and Douglas Miller

No 10306, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Despite the importance of living arrangements for well-being and production, the effect of changes in household income on living arrangements is not well understood. This study overcomes the identification problems that have limited the study of the link between income and living arrangements by exploiting a discontinuity in the benefit formula for the social pension in South Africa. In contrast to the findings of the existing literature from wealthier populations, we find no evidence that pension income is used to maintain the independence of black elders in South Africa. Rather, potential beneficiaries alter their household structure. Prime working age women depart, and we observe an increase in children under 5 and young women of child-bearing age. These shifts in co-residence patterns are consistent with a setting where prime age women have comparative advantage in work away from extended family relative to younger women. The additional income from old age support may induce a change in living arrangements to exploit this advantage.

JEL-codes: H55 J12 (search for similar items in EconPapers)
Date: 2004-02
New Economics Papers: this item is included in nep-lab
Note: CH
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Citations: View citations in EconPapers (9)

Published as Edmonds, Eric, K. Mammen and D. Miller. "Rearranging the Family? Household Composition Responses to Large Pension Receipts." The Journal of Human Resources 40, 1 (Winter 2005): 186-207.

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Journal Article: Rearranging the Family?: Income Support and Elderly Living Arrangements in a Low-Income Country (2005)
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