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Schizophrénie intergénérationnelle

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  • Bruno Decreuse
  • Bertrand Wigniolle

Abstract

Love pushed beyond its paroxysm leads to suffocation. That is the moral of this article, which depicts an altruistic parent setting her labour supply to offer the best living conditions to her child. When parents and children are perfectly substituable in production, this behaviour pushes all wages down. If hourly wages are rigid, employment is rationed and the youth are the primary victims of such rationing. We show this mechanism may originate endogenous fluctuations between under and full employment when the older workers? productivity negatively responds to past unemployment. We also analyse the political support for the minimum wage. When the youth productivity is random, the minimum wage, the older workers? labour supply and youth unemployment together rise with the intensity of parental altruism.

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Bibliographic Info

Article provided by De Boeck Université in its journal Recherches économiques de Louvain.

Volume (Year): 72 (2006)
Issue (Month): 1 ()
Pages: 49-74

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Handle: RePEc:cai:reldbu:rel_721_0049

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Web page: http://www.cairn.info/revue-recherches-economiques-de-louvain.htm

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Keywords: OLG model; altruism; endogenous labour supply; unemployment;

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  1. Sascha O. Becker & Samuel Bentolila & Ana Fernandes & Andrea Ichino, 2004. "Job Insecurity and Children's Emancipation," CESifo Working Paper Series 1144, CESifo Group Munich.
  2. Lambrecht, Stéphane & Michel, Philippe & Vidal, Jean-Pierre, 2001. "Public pensions and growth," Working Paper Series 0090, European Central Bank.
  3. Russell S. Sobel, 1999. "Theory and Evidence on the Political Economy of the Minimum Wage," Journal of Political Economy, University of Chicago Press, vol. 107(4), pages 761-785, August.
  4. Saint-Paul, Gilles, 1993. "On the Political Economy of Labour Market Flexibility," CEPR Discussion Papers 803, C.E.P.R. Discussion Papers.
  5. Emmanuel THIBAULT, 2001. "Bequests and the Intergenerational Degree of Altruism," Discussion Papers (REL - Recherches Economiques de Louvain) 2001022, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  6. Bazen, Stephen & Skourias, Nicolas, 1997. "Is there a negative effect of minimum wages on youth employment in France?," European Economic Review, Elsevier, vol. 41(3-5), pages 723-732, April.
  7. Agell, J., 1998. "On the Benefits from Rigid Labour Markets: Norms, Market Failures, and Social Insurance," Papers 1998:17, Uppsala - Working Paper Series.
  8. Barro, Robert J., 1974. "Are Government Bonds Net Wealth?," Scholarly Articles 3451399, Harvard University Department of Economics.
  9. Abowd, John M & Kramarz, Francis & Margolis, David N, 1999. "Minimum Wages and Employment in France and the United States," CEPR Discussion Papers 2159, C.E.P.R. Discussion Papers.
  10. Coate, Stephen, 1995. "Altruism, the Samaritan's Dilemma, and Government Transfer Policy," American Economic Review, American Economic Association, vol. 85(1), pages 46-57, March.
  11. Stark, Oded, 1989. "Altruism and the Quality of Life," American Economic Review, American Economic Association, vol. 79(2), pages 86-90, May.
  12. Philippe Michel & Pierre Pestieau, 2000. "Retraite par répartition et âge de la retraite," Revue Économique, Programme National Persée, vol. 51(1), pages 15-30.
  13. Hu, Sheng Cheng, 1979. "Social Security, the Supply of Labor, and Capital Accumulation," American Economic Review, American Economic Association, vol. 69(3), pages 274-83, June.
  14. Cahuc, Pierre & Michel, Philippe, 1996. "Minimum wage unemployment and growth," European Economic Review, Elsevier, vol. 40(7), pages 1463-1482, August.
  15. Marceau, Nicolas & Boadway, Robin, 1994. " Minimum Wage Legislation and Unemployment Insurance as Instruments for Redistribution," Scandinavian Journal of Economics, Wiley Blackwell, vol. 96(1), pages 67-81.
  16. Abowd, John M. & Kramarz, Francis & Margolis, David N. & Philippon, Thomas, 2000. "The Tail of Two Countries: Minimum Wages and Employment in France and the United States," IZA Discussion Papers 203, Institute for the Study of Labor (IZA).
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