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Winners and Losers from a Demographic Shock under Different Intergenerational Transfer Schemes

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Author Info
Zamac , Jovan () (Department of Economics)

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Abstract

This study investigates the general equilibrium effects of a fertility shock under different intergenerational transfer schemes. The effects on lifetime income and utility for different generations, as well as the effects on factor prices, are analyzed in a three-period overlapping generations model where the workers provide for the young and the retired under different tax schemes. The economic effects of a fertility shock vary substantially with different intergenerational transfer schemes. How wages, interest rate and savings will evolve differs not only quantitatively but also qualitatively. To minimize the effects from a fertility shock it is vital that the effects on human capital are minimized. For a baby boom shock this implies that a higher fraction of output must be devoted to human capital accumulation, during the educational years of the baby boom generation. With respect to transfers to the old, the tax rate should not be fixed.

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Publisher Info
Paper provided by Uppsala University, Department of Economics in its series Working Paper Series with number 2005:13.

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Length: 44 pages
Date of creation: 01 Mar 2005
Date of revision:
Handle: RePEc:hhs:uunewp:2005_013

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Postal: Department of Economics, Uppsala University, P. O. Box 513, SE-751 20 Uppsala, Sweden
Phone: + 46 18 471 25 00
Fax: + 46 18 471 14 78
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Web page: http://www.nek.uu.se/
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Related research
Keywords: Intergenerational transfers; demography; social security; education;

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Find related papers by JEL classification:
H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth

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References listed on IDEAS
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Hallberg, Daniel, 2006. "Cross-national differences in income poverty among Europe´s 50+," Working Paper Series 2006:14, Uppsala University, Department of Economics. [Downloadable!]
  2. Berg, Lennart & Berger, Tommy, 2005. "The Q theory and the Swedish housing market –an empirical test," Working Paper Series 2005:19, Uppsala University, Department of Economics. [Downloadable!]
  3. Johansson, Fredrik & Klevmarken, Anders, 2006. "Explaining the size and nature of response in a survey on health status and economic standard," Working Paper Series 2006:2, Uppsala University, Department of Economics. [Downloadable!]
  4. Jovan Zamac, 2005. "Pension Design when Fertility Fluctuates: The Role of Capital Mobility and Education Financing," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  5. Engström, Per & Holmlund, Bertil, 2006. "Tax Evasion and Self-Employment in a High-Tax Country: Evidence from Sweden," Working Paper Series 2006:12, Uppsala University, Department of Economics. [Downloadable!]
    Other versions:
  6. Engström, Per & Holmlund, Bertil, 2005. "Worker Absenteeism in Search Equilibrium," Working Paper Series 2005:22, Uppsala University, Department of Economics. [Downloadable!]
    Other versions:
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