Altruism, Favoritism, and Guilt in the Allocation of Family Resources: Sophie's Choice in Mao's Mass Send-Down Movement

We use survey data on twins in urban China, among whom many experienced the consequences of the forced mass rustication movement of the Cultural Revolution, to identify the roles of altruism, favoritism, and guilt in affecting family behavior. We exploit the fact that many families were forced to select one of their adolescent children to be sent down. We show the conditions under which guilt, favoritism, and altruism can be identified using such data. We find that parents behaved altruistically, showed favoritism, but also exhibited guilt: the child experiencing more rustication years received higher parental transfers despite having higher earnings. (c) 2010 by The University of Chicago. All rights reserved..