Effect of older adults in the family on the sandwich generation's pursuit of entrepreneurship: evidence from China

Abstract

AbstractHousehold entrepreneurship is a basic unit of entrepreneurial activity, and a crucial aspect of connecting personal and social wellbeing. This study examines the relationship between the proportion of elderly family members and household entrepreneurship. This study also assesses the mediating effect of the middle-aged generation's support to their parents and the moderating effect of the parents’ support with respect to the proportion of elderly family members and entrepreneurship. We use data from the China Family Panel Studies. We adopt the instrumental variable method to deal with endogeneity, robustness and credibility of the estimation results. The results show that a higher proportion of elderly family members impedes household entrepreneurship. Moreover, the financial and instrumental support provided by the middle-aged generation to their parents significantly mediates the relationship between the proportion of elderly family members and household entrepreneurship. In turn, parents’ financial support to the middle-aged generation moderates the focal relationship; however, parents’ instrumental support does not moderate the focal relationship. These findings emphasise the need to develop a comprehensive social security network for older adults that will indirectly promote household entrepreneurship, and improve personal and social wellbeing.