Inter-Vivos Transfers and Exchange (Link Between Informal Care and Economic Motives‪)‬

1. Introduction Economists have long looked for evidence of exchange or altruism as a motive for bequests. Altruism is when parents equalize their children's marginal utility of wealth by giving more bequests to their poorer children (Wilhelm 1996; Altonji, Hayashi, and Kotlikoff 1997; Sloan, Zhang, and Wang 2002). Exchange is when parents give more bequests to the child or children who provide more informal care and attention. The theoretical literature on bequests argues that exchange is an important motivation for bequests (Bernheim, Schleifer, and Summers 1985; Bernheim 1991). The empirical evidence, however, is mixed, with some papers finding bequests positively associated with attention (Bernheim, Schleifer, and Summers 1985; Bernheim 1991) and others not finding evidence of exchange (Sloan and Norton 1997; Perozek 1999). Recently, economists have turned their attention from bequests to inter-vivos transfers and have found mixed evidence of altruism (Altonji, Hayashi, and Kotlikoff 1997; McGarry and Schoeni 1997; McGarry 1999).