I present a model where disagreements about the composition of spending in a polarized and politically unstable society result in implementation of short-sighted policies and large governments. Investment rates are too low which slows down growth along the transition. In the long run, this...

The size of the Social Security program as a percentage of output has increased continuously since its inception. The main expansion has been on the extensive margin (number of individuals under the program), rather than on the intensive margin (benefits per old). Most of the increase was not...