Ginevra Floridi (Nuffield College).- Inequality and class divides in parental transfers to young adults in the United States.

Abstract

Parental support to young-adult children contributes to the reproduction of inequality in society, yet monetary and co-residential transfers to young adults are understudied as means of status reproduction. I test the relationship between state-level inequality and socio-economic gradients in parental transfers of money and co-residence to young-adults (aged 22-35) in the United States (US). I link state-level economy indicators to longitudinal data on 39,719 parent-child dyads from the Health and Retirement Study (1992–2018). Using two-way fixed-effects models, I investigate how changes in state-level inequality relate to changes in social class gradients in parental transfers over time. As state-level inequality increases, upper-class parents become more likely to transfer money, while lower-class parents become less likely to give money and more likely to live with their children. Since financial support leads to better child outcomes than co-residence, rising US inequality may hinder social mobility by shifting the socio-economic distribution of inter-vivos transfers.