The Role of Social Norms in Old-age Support: Evidence from China

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The norm of families providing support to the elderly is common in developing countries without comprehensive pension coverage and is important; it is usually gender-specific. This paper studies the inter-generational transmission of this social norm in China, focusing on the same-gender transmission channel. The mechanism behind this transmission is that parents, by their provision of support to their own parents, shape their children's preference for same-gender old-age support. That is, parents support their own parents according to the gender of their children. Given that the gender ratio of Chinese children is not random, I use an interaction term of the timing of the ban on sex-selective abortions in China and the gender of the first-born child as the instrumental variable for the gender of the children to alleviate possible endogeneity from the unbalanced gender ratio. The empirical results, using two Chinese datasets, show that parents with more same-gender children provide more support to their ageing parents than parents with cross-gender ones. The father effect is more significant in rural subsamples, and the mother effect is seen mainly in the urban ones. The urban-rural difference in the results may indicate a normative shift accompanying economic and demographic changes.