Consequences of the Financial Crisis for the Intrafamilial Exchange of Resources

In recent years there has been growing interest in the role of private intrafamilial transfers in the family economy. This topic is especially crucial for policy makers during periods of economic downturn, as private support and public transfers are inter-related. The current study examined the changes in the flow of private financial and non-financial transfers from middle aged Europeans to their adult children and their elderly parents, because of the economic crisis in 2008. I considered two main questions. (i) What was the initial impact that the economic crisis had on both financial and non-financial familial support? (ii) Did the economic crisis have long-term consequences for the tendency to provide intrafamilial support? The study shows that the economic crisis has an immediate and the long-term impact on the frequency of providing intrafamilial support. According to the results, practical help to adult children and elderly parents sharply decreased after the crisis. However, while the rate of practical help to parents recovered somewhat in the short-term, there was still found a significant gap between the frequencies of such help provided to adult children even after six years the economic crisis. As for financial transfers, I found that large financial transfers were not affected by the crisis, but small-scale financial support was affected, mainly in the short term. The results, thus, suggest that economic shocks negatively affect not only financial supports, to varying degrees, but also the non-financial transfers of support within the family