Why do First-Born Children Live with Parents?: Geography of the Family in Japan

Wataru Kureishi, Osaka University
Midori Wakabayashi, Osaka Prefecture University

In this paper, we analyze the strategic interaction between siblings who choose their residential locations in order to receive childcare assistance from their parents. Our three-stage game yields a theoretical result that a first-born child lives closer to his/her parents than a second-born child, which is supported by our estimation results using Japanese micro data. We also show that the childcare assistance from parents is one of the main determinants of the residential location choice of siblings. This paper is the first to succeed in explaining the residential location choice of siblings in Japan using economic incentives.