In this paper, we use new survey data on twins born in urban China, among whom many
experienced the consequences of the forced mass rustication movement of the Chinese “cultural
revolution,” to identify the distinct roles of altruism and guilt in affecting behavior within
families. Based on a model depicting the choices of the allocation of parental time and transfers
to multiple children incorporating favoritism, altruism and guilt, we show the conditions under
which guilt and altruism can be separately identified by experimental variation in parental time
with children. Based on within-twins estimates of affected cohorts, we find that parents selected
children with lower endowments to be sent down; that parents behaved altruistically, providing
more gifts to the sibling with lower earnings and schooling; but also exhibited guilt – given the
current state variables of the two children, the child experiencing more years of rustication
received significantly higher transfers.
Key Words: Guilt, Altruism, China
JEL Codes: J12, J13, O12