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Pensions and fertility: in search of a link

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  • Firouz Gahvari

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Abstract

In overlapping generations models with endogenous fertility wherein the retired partake of consumption but do not contribute to production (through their labor), fertility has a positive and a negative externality. These can be internalized through a child allowance (or tax) or a linkage between pension benefits and the number of children. The prescription rest crucially on the assumption that no parents are better than others in raising their children and that fertility can be perfectly controlled. When either of these two assumptions are violated, the case for such policy recommendations are greatly weakened. Copyright Springer Science+Business Media, LLC 2009

Suggested Citation

  • Firouz Gahvari, 2009. "Pensions and fertility: in search of a link," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 16(4), pages 418-442, August.
  • Handle: RePEc:kap:itaxpf:v:16:y:2009:i:4:p:418-442
    DOI: 10.1007/s10797-009-9114-3
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    References listed on IDEAS

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    1. van Groezen, B.J.A.M. & Leers, T. & Meijdam, A.C., 2000. "Family Size, Looming Demographic Changes and the Efficiency of Social Security Reform," Discussion Paper 2000-27, Tilburg University, Center for Economic Research.
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    Citations

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    Cited by:

    1. Cremer, Helmuth & Gahvari, Firouz & Pestieau, Pierre, 2011. "Fertility, human capital accumulation, and the pension system," Journal of Public Economics, Elsevier, vol. 95(11), pages 1272-1279.
    2. Pierre Pestieau & Gregory Ponthiere, 2013. "Childbearing Age, Family Allowances, and Social Security," Southern Economic Journal, Southern Economic Association, vol. 80(2), pages 385-413, October.
    3. repec:dem:demres:v:36:y:2017:i:42 is not listed on IDEAS
    4. Pierre Pestieau & Grégory Ponthière, 2011. "Childbearing Age, Family Allowances and Social Security," Working Papers hal-00612613, HAL.
    5. Gahvari, Firouz & Beach, Randy, 2016. "On the optimal linkage of social security benefits to payroll taxes," Research in Economics, Elsevier, vol. 70(1), pages 110-121.

    More about this item

    Keywords

    Pay-as-you-go; Overlapping generations; Endogenous fertility; Externality of fertility; Stochastic fertility; Moral hazard; Parents’ heterogeneity; Adverse selection; H55; J13;

    JEL classification:

    • 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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