Did mom always like you best? Exploring parents' financial support of their children

Kathleen McGarry, professor of economics at UCLA, will present the spring Luther College Phi Beta Kappa lecture, "Intergenerational Transfers from Parents to Children," at 7 p.m. Thursday, Feb.12, in the Franklin W. Olin Building Room 102 on the Luther College campus.

She will also present "50 Years of the War on Poverty: What it has Meant for the Elderly," at a brown bag session at noon Thursday, Feb. 12, in the Mott Room of Dahl Centennial Union on the Luther campus.

            The lecture and brown bag session are open to the public with no charge for admission.

            The lecture, part of the PBK Visiting Scholar Program, focuses on how parents invest an enormous amount in their children when children are young, and how—perhaps surprisingly—this support continues long after the children are grown and have formed their own households. The talk analyzes patterns of giving from parents to adult children, including the prevalence and magnitude of these transfers. McGarry will explore which children are the primary beneficiaries and if mom really always "liked you best." She will also discuss whether the distribution of transfers depends on the form — cash transfers during a parent's life, versus bequests or schooling investments.

            In her brown bag session, McGarry will discuss Lyndon B. Johnson's "war on poverty” State of the Union address. In the 50 years since the speech, the poverty rate for the elderly has fallen from 35 percent to just below 10 percent, below that of other age groups and less than one-half of that for children. McGarry will discuss the role of various social insurance programs in this dramatic decline and explain how the poverty rate is currently calculated and the extent to which these numbers accurately depict the situation for the elderly.

            McGarry served as senior economist at the White House Council of Economics Advisers and was the Hyatt 1972 Professor of Economics at Dartmouth College (2007-09). She has been a research associate with the National Bureau of Economic Research since 1999. Her fields of interest are public economics, health economics, and the economics of aging and her current research focuses on the long-term care, health, and life insurance markets.

Since 1956, the Phi Beta Kappa Visiting Scholar Program has offered undergraduates the opportunity to spend time with some of America's most distinguished scholars. The purpose of the program is to contribute to the intellectual life of the campus by making possible an exchange of ideas between the Visiting Scholars and the resident faculty and students. 

The Phi Beta Kappa Society's intention is to celebrate and advocate excellence in the liberal arts and sciences. Luther's PBK chapter invites for induction the most outstanding arts and sciences students on campus. The Society sponsors activities to advance these studies — the humanities, the social sciences, and the natural sciences — in higher education and in society at large. 

Kathleen McGarry