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Do Siblings Free-Ride in "Being There" for Parents?

Family enjoying life

Shiko Maruyamaya and Meliyanni Johar

When siblings are concerned for the well-being of their elderly parents, the costs of care giving and long-term commitment create a free-rider problem. If siblings living near their parents can share the costs, this positive externality exacerbates the under-provision of proximate living. Location decisions allow siblings to make a commitment to not provide long-term support for parents, and if decisions are made in birth order, elder siblings may enjoy the first-mover advantage. To quantify these effects, we study siblings' location decisions relative to parents by estimating a sequential participation game that features rich heterogeneity.

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