This paper develops an overlapping generations model of Social Security and human capital formation in which - somewhat against the conventional wisdom - an increase in the dependency ratio can lead to a reduced tax burden or less generous social transfers. A higher dependency ratio resulting...

The extent of taxation and redistribution policy is generally determined as a political-economy equilibrium by a balance between those who gain from higher taxes/transfers and those who lose. In a stylized model of migration and human capital formation, we show -- somewhat against the conventi...