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Fertility, social mobility and long run inequality

Listed author(s):
  • Córdoba, Juan Carlos
  • Liu, Xiying
  • Ripoll, Marla

Dynastic altruistic models with endogenous fertility have been shown to be unable to generate enough intergenerational persistence. Using a Bewley model with endogenous fertility we show that it is possible to recover persistence. Key ingredients for our result include exponential child discounting, discrete number of children, diminishing costs of child rearing, and an elasticity of intergenerational substitution larger than one. Our model provides a unified framework of analysis for long-run inequality that incorporates fertility choices.

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File URL: http://www.sciencedirect.com/science/article/pii/S0304393215001269
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Article provided by Elsevier in its journal Journal of Monetary Economics.

Volume (Year): 77 (2016)
Issue (Month): C ()
Pages: 103-124

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Handle: RePEc:eee:moneco:v:77:y:2016:i:c:p:103-124
DOI: 10.1016/j.jmoneco.2015.10.007
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505566

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