Effects of the taxation on inheritance in a microfounded model of growth and post-Keynesian distribution with overlapping generations and life cycle

This paper extends the model of overlapping generations with heterogeneous agents, allowing both classes (capitalist and worker) to hold a positive intergenerational capital stock. The main results were:(i)equilibrium interest rates that maximize the consumption and savings plans of working and capitalist classes were positively affected by taxation;(ii)an increase in taxation and therefore, in transfers to the working class raises the participation of intergenerational inheritance of this class in the total capital stock;(iii)the taxation affects the distribution of wealth between the classes because it increases the participation of the working class in the total capital stock of the economy.