Transfers from Old Parents to Single Adult Children in Korea

Using the first wave of the Korean Longitudinal Study of Ageing, KLoSA), a nationwide representative study of middle/old-aged population in 2006, we examines (1) how the young adults and their parents exchange economic resources in Korean and (2) whether the above two theories explain economic exchange behaviors. Our sample consists of 1,067 parents who have 1,392 single children who finish formal education, live independently and from 19 to 39 years old. We find that 12.6% of the parents provide an average of 4,593,000 won (=$4,130) to young adult children during the last year. And we find that 35.2% of young adult children provide an average of 1,674,000 won (=$1,505) to parents. Contrary to the dominance of downward transfers in developed countries between young adult children and their old parents, many children help old parents economically in Korea. Tobit models of downward and upward transfers indicate that parents with more economic resources and home ownership and children with higher education levels and out of work are more likely to participate in downward transfers and that parents in economic need and with health problems and children who are older and earn money are more likely to participate in upward transfers.