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Social security, public education, and growth in a representative democracy

Author

Listed:
  • Alexander Kemnitz

    () (University of Mannheim, Department of Economics, A5, D-68131 Mannheim, Germany)

Abstract

This paper studies the relationship between public education and pay-as-you-go social security in a representative democracy, where the government reacts both to voting and lobbying activities of workers and pensioners. While an intergenerational conflict prevails concerning actual social security contributions, workers may prefer public education for its positive effect on later pension benefits. Population aging diminishes the relative lobbying power of pensioners, leading to a higher contribution rate, educational expansion, and higher per capita income growth.

Suggested Citation

  • Alexander Kemnitz, 2000. "Social security, public education, and growth in a representative democracy," Journal of Population Economics, Springer;European Society for Population Economics, vol. 13(3), pages 443-462.
  • Handle: RePEc:spr:jopoec:v:13:y:2000:i:3:p:443-462
    Note: Received: 05 April 1999/Accepted: 20 December 1999
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    Citations

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    Cited by:

    1. Tetsuo Ono & Yuki Uchida, 2016. "Human Capital, Public Debt, and Economic Growth: A Political Economy Analysis," Discussion Papers in Economics and Business 16-01-Rev.3, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP), revised Oct 2017.
    2. Gianko Michailidis & Concepció Patxot & Meritxell Solé Juvés, 2016. "Do pensions foster education? An empirical perspective," UB Economics Working Papers 2016/344, Universitat de Barcelona, Facultat d'Economia i Empresa, UB Economics.
    3. Panu Poutvaara, 2006. "On the political economy of social security and public education," Journal of Population Economics, Springer;European Society for Population Economics, vol. 19(2), pages 345-365, June.
    4. Ono, Tetsuo & Uchida, Yuki, 2016. "Pensions, education, and growth: A positive analysis," Journal of Macroeconomics, Elsevier, vol. 48(C), pages 127-143.
    5. Alison Booth & Facundo Sepulveda, 2007. "Endogenous Fertility Policy And Unfunded Pensions," CAMA Working Papers 2007-06, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    6. repec:spr:jopoec:v:31:y:2018:i:3:d:10.1007_s00148-018-0690-3 is not listed on IDEAS
    7. Michael Kaganovich & Volker Meier, 2012. "Social Security Systems, Human Capital, and Growth in a Small Open Economy," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 14(4), pages 573-600, August.
    8. Haupt, Alexander, 2012. "The evolution of public spending on higher education in a democracy," European Journal of Political Economy, Elsevier, vol. 28(4), pages 557-573.
    9. Tetsuo Ono, 2015. "Public education and social security: a political economy approach," Economics of Governance, Springer, vol. 16(1), pages 1-25, February.
    10. Jorge Soares, 2006. "A dynamic general equilibrium analysis of the political economy of public education," Journal of Population Economics, Springer;European Society for Population Economics, vol. 19(2), pages 367-389, June.
    11. Kaganovich, Michael & Zilcha, Itzhak, 2012. "Pay-as-you-go or funded social security? A general equilibrium comparison," Journal of Economic Dynamics and Control, Elsevier, vol. 36(4), pages 455-467.
    12. Cattaneo, M. Alejandra & Wolter, Stefan C., 2009. "Are the elderly a threat to educational expenditures?," European Journal of Political Economy, Elsevier, vol. 25(2), pages 225-236, June.
    13. Tetsuo Ono, 2014. "Economic Growth and the Politics of Intergenerational Redistribution," Discussion Papers in Economics and Business 14-17, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP).
    14. Ueli Grob & Stefan C. Wolter, 2007. "Demographic Change and Public Education Spending: A Conflict between Young and Old?," Education Economics, Taylor & Francis Journals, vol. 15(3), pages 277-292.
    15. Naito, Katsuyuki, 2012. "Two-sided intergenerational transfer policy and economic development: A politico-economic approach," Journal of Economic Dynamics and Control, Elsevier, vol. 36(9), pages 1340-1348.
    16. Michael Kaganovich & Itzhak Zilcha, 2008. "Alternative Social Security Systems and Growth," CESifo Working Paper Series 2353, CESifo Group Munich.
    17. Naito, Katsuyuki, 2010. "Two-sided Intergenerational Transfer Policy and Economic Development: A Politico-economic Approach," MPRA Paper 21020, University Library of Munich, Germany.
    18. Yew, Siew Ling & Zhang, Jie, 2013. "Socially optimal social security and education subsidization in a dynastic model with human capital externalities, fertility and endogenous growth," Journal of Economic Dynamics and Control, Elsevier, vol. 37(1), pages 154-175.
    19. Gianko Michailidis & Concepció Patxot, 2018. "Political viability of intergenerational transfers. An empirical application," UB Economics Working Papers 2018/370, Universitat de Barcelona, Facultat d'Economia i Empresa, UB Economics.
    20. repec:eee:hapoch:v1_381 is not listed on IDEAS
    21. van Groezen, B.J.A.M. & Meijdam, A.C. & Verbon, H.A.A., 2002. "Social Security Reform and Population Ageing in a Two-Sector Growth Model," Discussion Paper 2002-25, Tilburg University, Center for Economic Research.

    More about this item

    Keywords

    Pensions · education · aging;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy

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