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Capital accumulation, welfare and the emergence of pension fund activism

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  • Pascal Belan

    (LEN - Laboratoire d'économie de Nantes - IEMN-IAE Nantes - Institut d'Économie et de Management de Nantes - Institut d'Administration des Entreprises - Nantes - UN - Université de Nantes)

  • Philippe Michel

    (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique)

  • Bertrand Wigniolle

    (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

Abstract

This paper presents an overlapping generations model with altruistic consumers, in which pension funds, by holding a signi...cant share of capital assets, produce non competitive behavior. We study the consequences of such behavior on capital accumulation and welfare in the long run when subsidies are associated with contributions to pension funds. If bequests are operative and the subsidy rate is not too high, the capital stock increases with the introduction of pension funds, and this increases long run utility. If bequests are not operative without pension funds, the rise in long-run welfare is no longer guaranteed, even if the subsidy rate is low.

Suggested Citation

  • Pascal Belan & Philippe Michel & Bertrand Wigniolle, 2007. "Capital accumulation, welfare and the emergence of pension fund activism," Post-Print halshs-00268847, HAL.
    • Handle: RePEc:hal:journl:halshs-00268847
    DOI: 10.1628/001522107X186728
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00268847
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    More about this item

    Keywords

    imperfect competition; capital accumulation; pension funds; altruism;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • D9 - Microeconomics - - Micro-Based Behavioral Economics
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers

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