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Intergenerational altruism and the transfer paradox in an overlapping generations model

Listed author(s):
  • Hamada, Kojun
  • Yanagihara, Mitsuyoshi
Registered author(s):

    This study investigates how intergenerational altruism affects the possibility of the transfer paradox occurring in a two-country, one-sector overlapping generations model. We derive the conditions under which the transfer paradox occurs in our model where a generation within each country has altruism toward the subsequent generation. Contrary to earlier results in the literature, we find that altruism does not enter the conditions under which the transfer paradox occurs in the steady state. Moreover, we show that although altruism affects the condition of the transfer paradox along the transition path, its effect on this condition vanishes as the economy converges to the steady state.

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    File URL: http://www.sciencedirect.com/science/article/pii/S106297691500054X
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    Article provided by Elsevier in its journal The Quarterly Review of Economics and Finance.

    Volume (Year): 59 (2016)
    Issue (Month): C ()
    Pages: 161-167

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    Handle: RePEc:eee:quaeco:v:59:y:2016:i:c:p:161-167
    DOI: 10.1016/j.qref.2015.04.001
    Contact details of provider: Web page: http://www.elsevier.com/locate/inca/620167

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