April 2007

IZA DP No. 2726: How Does the Presence of Children Affect Dependent Care? A Psycho-Economic Approach

This paper adopts a psycho-economic approach, based on the "Demonstration Effect" hypothesis, to analyze the effects that the presence of children has on the time devoted to elder care. We combine the approach of the Social Cognitive Theory and a three-generation altruism model. Using the 2003 Spanish Time Use Survey (STUS), we confirm the "Demonstration Effect", i.e, the presence of children, while parents are engaged in elder care activities, increases by 11.63% the time devoted to these activities. Additionally, we find that time devoted to child care as primary activity increases by 11.19 minutes per day when children are present during adult care activities.