Optimal Intergenerational Redistribution in a Two-Country Model with Endogenous Fertility
We analyze a model with two countries that are linked by an integrated capital market. Fertility, and thus population growth, is endogenously determined by households. Our analysis proceeds in three steps: First, we characterize an optimal intertemporal and interregional allocation in a model with endogenous fertility and two countries. Second, we look for an institution supporting the optimal allocation. It turns out that in general, a decentralized equilibrium is inefficient. National public-pension systems with benefits that are related to the number of children implements the optimal allocation. This provides a justification for government interventions beyond its role as a "night-watchman." Third, we analyze whether national governments have the right incentives to implement the optimal system. It turns out that every national government has an incentive to deviate from the optimal structure and to shift part of the burden to the other country. Policy implications for the institutional arrangements within the European Union are discussed. Copyright 2001 by Kluwer Academic Publishers
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.:
- Hans-Werner Sinn, 1990.
"Tax Harmonization and Tax Competition in Europe,"
NBER Working Papers
3248, National Bureau of Economic Research, Inc.
- Martin Kolmar, 1997. "Intergenerational redistribution in a small open economy with endogenous fertility," Journal of Population Economics, Springer, vol. 10(3), pages 335-356.
- Lapan, Harvey E. & Enders, Walter, 1990.
"Endogenous Fertility, Ricardian Equivalence and Debt Management Policy,"
Staff General Research Papers
10814, Iowa State University, Department of Economics.
- Lapan, Harvey E. & Enders, Walter, 1990. "Endogenous fertility, Ricardian equivalence, and debt management policy," Journal of Public Economics, Elsevier, vol. 41(2), pages 227-248, March.
- Assaf Razin & Efraim Sadka, 1995. "Population Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262181606, June.
- Deardorff, Alan V, 1976. "The Optimum Growth Rate for Population: Comment," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 17(2), pages 510-15, June.
- Bertrand Wigniolle, 2001. "Fertility, intergenerational transfers and economic development," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 11(3), pages 297-321.
- Cigno, Alessandro, 1986. "Fertility and the Tax-Benefit System: A Reconsideration of the Theory of Family Taxation," Economic Journal, Royal Economic Society, vol. 96(384), pages 1035-51, December.
- Schweizer, Urs, 1996. "Endogenous fertility and the Henry George Theorem," Journal of Public Economics, Elsevier, vol. 61(2), pages 209-228, August.
- Persson, Torsten, 1985.
"Deficits and intergenerational welfare in open economies,"
Journal of International Economics,
Elsevier, vol. 19(1-2), pages 67-84, August.
- Torsten Persson, 1983. "Deficits and Intergenerational Welfare in Open Economies," NBER Working Papers 1083, National Bureau of Economic Research, Inc.
- David E. Wildasin, 1994.
"Income Redistribution and Migration,"
Canadian Journal of Economics,
Canadian Economics Association, vol. 27(3), pages 637-56, August.
- David E. Wildasin, 1989.
"Non-Neutrallity of Debt with Endogenous Fertility,"
Discussion Paper Serie A
241, University of Bonn, Germany.
- Samuelson, Paul A, 1975. "The Optimum Growth Rate for Population," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 16(3), pages 531-38, October.
- Brown, Charles C. & Oates, Wallace E., 1987.
"Assistance to the poor in a federal system,"
Journal of Public Economics,
Elsevier, vol. 32(3), pages 307-330, April.
- MICHEL, Philippe & PESTIEAU, Pierre, .
"Population growth and optimality. When does serendipity hold?,"
CORE Discussion Papers RP
-1072, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Michel, Philippe & Pestieau, P, 1993. "Population Growth and Optimality: When Does Serendipity Hold?," Journal of Population Economics, Springer, vol. 6(4), pages 353-62, November.
- Stefan Homburg & Wolfram Richter, 1993.
"Harmonizing public debt and public pension schemes in the European community,"
Journal of Economics,
Springer, vol. 58(1), pages 51-63, December.
- Stefan Homburg & Wolfram Richter, 1993. "Harmonizing public debt and public pension schemes in the European community," Journal of Economics, Springer, vol. 7(1), pages 51-63, December.
- Eckstein, Zvi & Wolpin, Kenneth I., 1985. "Endogenous fertility and optimal population size," Journal of Public Economics, Elsevier, vol. 27(1), pages 93-106, June.
- Bental, Benjamin, 1989. "The Old Age Security Hypothesis and Optimal Population Growth," Journal of Population Economics, Springer, vol. 1(4), pages 285-301.
- Sinn, Hans-Werner, 1990. "Tax harmonization and tax competition in Europe," Munich Reprints in Economics 19846, University of Munich, Department of Economics.
- Wildasin, David E, 1991. "Income Redistribution in a Common Labor Market," American Economic Review, American Economic Association, vol. 81(4), pages 757-74, September.
- Nishimura, K. & Zhang, J., 1990.
"Pay-As-You-Go Public Pensions With Endogenous Fertility,"
202, Australian National University - Department of Economics.
- Nishimura, Kazuo & Zhang, Junsen, 1992. "Pay-as-you-go public pensions with endogenous fertility," Journal of Public Economics, Elsevier, vol. 48(2), pages 239-258, July.
- Raut, L. K., 1990. "Capital accumulation, income distribution and endogenous fertility in an overlapping generations general equilibrium model," Journal of Development Economics, Elsevier, vol. 34(1-2), pages 123-150, November.
- Peters, Wolfgang, 1995. "Public Pensions, Family Allowances and Endogenous Demographic Change," Journal of Population Economics, Springer, vol. 8(2), pages 161-83, May.
When requesting a correction, please mention this item's handle: RePEc:kap:pubcho:v:106:y:2001:i:1-2:p:23-51. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn)or (Christopher F. Baum)
If references are entirely missing, you can add them using this form.