Intrafamily Transfers and Health Status: Evidence from the Panel Study of Income Dynamics

Michael Dalton, Duke University
Daniel R. LaFave, Colby College

This study exploits longitudinal data from the Panel Study of Income Dynamics to examine the relationship between family transfers and the health status of family members. We relate the receipt of transfers to changes in an individual’s health, and show that deteriorating health is a cause for increased family assistance. This relationship is empirically robust in both pooled analysis and models exploiting the longitudinal structure of the data to look at changes within an individual over time. We begin by documenting that transfers are related to deteriorations in self-rated health, which then motivates an examination of limitations from specific health conditions. By utilizing data on labor market outcomes and insurance coverage, we are able to present a nuanced examination of informal family transfers as they relate to health. The results are informative for understanding patterns of resource allocation within families and how informal networks operate while facing adverse events.