Prodigality and myopia. Two rationales for social security
Among the rationales for social security, there is the fact that some people have to be forced to save. To explain undersaving, rational prodigality and hyperbolic preferences are often cited but treated separably. In this paper we study those two particular behaviors that lead to forced saving within an optimal income tax second-best setting.
|Date of creation:||01 Mar 2008|
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- Homburg, Stefan, 2000. "Compulsory savings in the welfare state," Journal of Public Economics, Elsevier, vol. 77(2), pages 233-239, August.
- O'Donoghue, Ted & Rabin, Matthew, 2000.
"Choice and Procrastination,"
Department of Economics, Working Paper Series
qt5r26k54p, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
- Feldstein, Martin & Liebman, Jeffrey B., 2002.
Handbook of Public Economics,
in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 4, chapter 32, pages 2245-2324
- George-Marios Angeletos, 2001. "The Hyberbolic Consumption Model: Calibration, Simulation, and Empirical Evaluation," Journal of Economic Perspectives, American Economic Association, vol. 15(3), pages 47-68, Summer.
- Jakob von Weizsäcker, 2003. "The Hayek Pension: An efficient minimum pension to complement the welfare state," CESifo Working Paper Series 1064, CESifo Group Munich.
- Diamond, Peter & Koszegi, Botond, 2003. "Quasi-hyperbolic discounting and retirement," Journal of Public Economics, Elsevier, vol. 87(9-10), pages 1839-1872, September.
- Martin Feldstein, 1985. "The Optimal Level of Social Security Benefits," The Quarterly Journal of Economics, Oxford University Press, vol. 100(2), pages 303-320.
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