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Elimination of Social Security in a Dynastic Framework

  • Luisa Fuster

    (Toronto & UPF)

  • Ayse Imrohoroglu

    (USC)

  • Selahattin Imrohoroglu

    (USC)

In this paper we study the welfare effects of eliminating social security in a model with two sided altruism where social security provides insurance against lifetime and individual income uncertainty. Our findings indicate that households are able to shift the efficiency gains, generated through privatization of social security, across parents and children quite successfully. Contrary to a pure life-cycle setup, our framework yields significant support for even an uncompensated elimination of unfunded social security.

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File URL: http://econwpa.repec.org/eps/mac/papers/0402/0402008.pdf
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Paper provided by EconWPA in its series Macroeconomics with number 0402008.

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Length: 30 pages
Date of creation: 04 Feb 2004
Date of revision:
Handle: RePEc:wpa:wuwpma:0402008
Note: Type of Document - pdf; prepared on Win2000; pages: 30
Contact details of provider: Web page: http://econwpa.repec.org

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