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Intergenerational altruism and neoclassical growth models

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  • Michel, Philippe
  • Vidal, Jean-Pierre
  • Thibault, Emmanuel

Abstract

This paper surveys intergenerational altruism in neoclassical growth models. It first examines Barro's approach to intergenerational altruism, whereby successive generations are linked by recursive altruistic preferences. Individuals have an altruistic concern only for their children, who in turn also have altruistic feelings for their own children. The conditions under which the Ricardian equivalence (debt neutrality) theorem applies are specified. The effectiveness of fiscal policy is further analysed in the context of an economy populated by heterogeneous families differing with respect to their degree of intergenerational altruism. Other forms of altruism, referred to as ad hoc altruism, are also examined, along with their implications for fiscal policy. JEL Classification: E13, D64, E62, C60

Suggested Citation

  • Michel, Philippe & Vidal, Jean-Pierre & Thibault, Emmanuel, 2004. "Intergenerational altruism and neoclassical growth models," Working Paper Series 386, European Central Bank.
    • Handle: RePEc:ecb:ecbwps:2004386
    Note: 147733
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    More about this item

    Keywords

    altruism; fiscal policy.; neoclassical general aggregative models;
    All these keywords.

    JEL classification:

    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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