Generational Conflict, Human Capital Accumulation, and Economic Growth
Worldwide, dependency ratios are forecast to increase dramatically in the next 50 years. A great deal of attention has been devoted to understanding the changes in fiscal policies that must' take place to accommodate these changes. In contrast, less effort has been concentrated on studying the fiscal shifts that will endogenously result from demographic pressures. An example of particular interest is the degree to which a more elderly population will support public spending for education. We use an overlapping-generations model to investigate the effect of this demographic transition on the endogenous determination of public spending for education. A demographic transition alters the identity of the median voter, leading to a preference for less education spending. If the public sector is inefficiently small, demographic transition exacerbates the underprovision of human capital. Alternatively, such a shift may trim an inefficiently large government, reduce tax rates and raise capital per worker enough to raise education spending. Thus, there is no automatic link between demographic transition and reduced support for those programs whose benefits are concentrated among the young.
|Date of creation:||Jun 2000|
|Date of revision:|
|Publication status:||Published as "Solow and States: Capital Accumulation, Productivity, and Economic Growth", National Tax Journal, Vol. 46, no. 4 (1993): 425-439.|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
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.:
- Holtz-Eakin, Douglas, 1993. "Demographics, Political Power and Economic Growth," Public Finance = Finances publiques, , vol. 48(Supplemen), pages 349-65.
- Lex Meijdam & Harrie Verbon, 1996.
"Aging and political decision making on public pensions,"
Journal of Population Economics,
Springer;European Society for Population Economics, vol. 9(2), pages 141-158, June.
- Meijdam, Lex & Verbon, Harrie A A, 1996. "Aging and Political Decision Making on Public Pensions," Journal of Population Economics, Springer;European Society for Population Economics, vol. 9(2), pages 141-58, May.
- Meijdam, A.C. & Verbon, H.A.A., 1996. "Aging and political decision making on public pensions," Other publications TiSEM 30434a77-0d7a-4d11-8fbd-3, Tilburg University, School of Economics and Management.
- Bovenberg, A.L. & van Ewijk, C., 1997.
"Progressive taxes, equity and human capital accumulation in an endogenous growth model with overlapping generations,"
Other publications TiSEM
6d8dd905-8f4d-4b98-8202-1, Tilburg University, School of Economics and Management.
- Bovenberg, A. Lans & van Ewijk, Casper, 1997. "Progressive taxes, equity, and human capital accumulation in an endogenous growth model with overlapping generations," Journal of Public Economics, Elsevier, vol. 64(2), pages 153-179, May.
- Cutler, D.M. & Poterba, J.M. & Sheiner, L.M. & Summers, L.H., 1990.
"An Aging Society: Opportunity Or Challenge,"
553, Massachusetts Institute of Technology (MIT), Department of Economics.
- Brueckner, Jan K, 1999. " Fiscal Federalism and Capital Accumulation," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 1(2), pages 205-24.
- Persson, Torsten & Tabellini, Guido, 1992.
"Growth, distribution and politics,"
European Economic Review,
Elsevier, vol. 36(2-3), pages 593-602, April.
- Kaganovich, M & Zilcha, I, 1997.
"Education, Social Security and Growth,"
1-97, Tel Aviv.
- James M. Poterba, 1996.
"Demographic Structure and the Political Economy of Public Education,"
NBER Working Papers
5677, National Bureau of Economic Research, Inc.
- James M. Poterba, 1997. "Demographic structure and the political economy of public education," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 16(1), pages 48-66.
- N. Gregory Mankiw & David Romer & David N. Weil, 1992.
"A Contribution to the Empirics of Economic Growth,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 107(2), pages 407-437.
- Glomm, Gerhard & Ravikumar, B., 1996. "Endogenous public policy and multiple equilibria," European Journal of Political Economy, Elsevier, vol. 11(4), pages 653-662, April.
- Julia Lynn Coronado & Don Fullerton & Thomas Glass, 2000.
"The Progressivity of Social Security,"
NBER Working Papers
7520, National Bureau of Economic Research, Inc.
- Wright, Randall, 1996. "Taxes, redistribution, and growth," Journal of Public Economics, Elsevier, vol. 62(3), pages 327-338, November.
- repec:fth:harver:1490 is not listed on IDEAS
- Epple, Dennis & Romano, Richard E., 1996. "Ends against the middle: Determining public service provision when there are private alternatives," Journal of Public Economics, Elsevier, vol. 62(3), pages 297-325, November.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:7762. 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: ()
If references are entirely missing, you can add them using this form.