Social Security, Child Allowances, and Endogenous Fertility
AbstractBased on a simple overlapping generations model with endogenous fertility, we show that the effectiveness of social security reform and childcare support depends much on the openness of the economy, altruism, and initial fertility. For example, introducing a child allowance, which is often expected to mitigate demographic pressures, might be ineffective in a closed economy. Downsizing a social security system, even with new taxes required to compensate for existing pension liabilities, could be welfare-improving in a closed economy. Altruistic bequests tend to offset intergenerational income transfer caused by policy changes, but a higher level of initial fertility makes the outcome indeterminate.
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Bibliographic InfoPaper provided by Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University in its series Discussion Paper with number 171.
Length: 34,  p.
Date of creation: Sep 2003
Date of revision:
Find related papers by JEL classification:
- H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
- H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
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- Alessandro Cigno & Annalisa Luporini & Anna Pettini, 2000.
"Tranfers to families with children as a principal-agent problem,"
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- Alessandro Cigno & Luca Casolaro & Furio C. Rosati, 2000.
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CESifo Working Paper Series
394, CESifo Group Munich.
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