Family transfers, coresidency and elderly labor supply: evidence from Indonesia

Both developed and developing countries have faced a phenomenon that is difficult to avoid, namely an ageing population. Furthermore, developed countries have strategies and programs that are more structured and mature to deal with this phenomenon than developing countries, including Indonesia. In the absence of adequate and comprehensive formal assistance from the government, elderly people depend on intergenerational support and income from their participation in the labor market. This paper discusses the relationship between intergenerational support (family transfer and coresidency) with elderly labor supply implementing quantitative methods. Utilizing IFLS data, this study found that family transfer and coresidency reduce the decision of elderly people to work during retirement. Moreover, the characteristics of children and parents are essential factors to motivate family transfer and coresidency.