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The worldwide problem with pay-as-you-go, defined-benefits social security systems is not just financial. Through a dynamic, overlapping-generations model where forming a family and bearing and educating children are choice variables, we show that social security taxes and benefits generate...
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oversupply of savings. Other forces that work in the same direction and can both create or exacerbate the problem include a drop … in population growth, an increase in income inequality, and a fall in the relative price of investment. Our model sheds …
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