Unintended consequences of introducing state pensions


Published 01.05.19
Photo credit:
Zol Muhd/flickr

State pensions in Indonesia and Ghana are found to impact parents and their children, with respect to elderly care and investment in education

Matrilocality and patrilocality refers to daughters and sons, respectively, living with their parents and taking care of them in old age. In this video, Natalie Bau discusses research on the effect of pension plans on matrilocality in Indonesia and patrilocality in Ghana. In both cases, the introduction of pension plans leads to a cultural shift away from children looking after their parents. An unintended consequence of this is a reduction in education among traditionally matrilocal or patrilocal groups, as parents who no longer expect to be cared for by their children have less incentive to provide for their education.