Capital Accumulation and Fiscal Policy in an OLG Model with Family Altruism
The idea of family altruism is that parents care only about their children's income and not about the use of this income made by the children. First, we establish dynamical properties which place the OLG model with family altruism halfway between the model with pure life-cyclers ( <link rid="b10">Diamond 1965</link>; American Economic Review 55, 1126-1150) and the one with dynastic altruism ( <link rid="b4">Barro 1974</link>; Journal of Political Economy 82, 1095-1117). Then, we show that this concept leads to interesting fiscal policy conclusions less clear-cut and more realistic than those obtained with the two previous standard OLG models: a pay-as-you-go social security is neutral but not a public debt. Copyright 2006 Blackwell Publishing, Inc..
Year of publication: |
2006
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Authors: | LAMBRECHT, STÉPHANE ; MICHEL, PHILIPPE ; THIBAULT, EMMANUEL |
Published in: |
Journal of Public Economic Theory. - Association for Public Economic Theory - APET, ISSN 1097-3923. - Vol. 8.2006, 3, p. 465-486
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Publisher: |
Association for Public Economic Theory - APET |
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