Long-Term Health Benefits from Investments in Children's Education

Iliana V. Kohler, University of Pennsylvania

In this paper, we hypothesize that education of adult children has a separate effect on health and survival of their elderly parents that is independent from children's SES status, income, and financial support given to their parents. In particular, we investigate the role of children's education for health and mortality risks of elderly parents in the context of Mexico. Our analyzes are based on the Mexican Health and Aging Study (MHAS) that is one of the handful of datasets for developing countries combining detailed information about the health dynamics of elderly people and transfer behaviors between them and their adult children. A unique aspect of our analyzes is the attempt to resolve the endogeneity of children's education by incorporating the instrumental variable approach. The proposed methods provide for the first time a systematic attempt using instrumental variable estimation to establish the effect of child education on parental health at old ages.