This paper develops a theory of the two-armed intergenerational welfare state, consistent with key features of modern welfare arrangements, and uses it to rationalise the rise and fall in generosity of pay-as-you-go pensions solely on efficiency grounds. By using the education arm, a...

A popular view about social security, dating back to its early days of inception, is that it is a means for young, unemployed workers to 'purchase' jobs from older, employed workers. The question we ask is: Can social security, by encouraging retirement and hence creating job vacancies for the...

Child labor deprives children of their childhood, compromises their schooling, and stuntstheir future potential; yet, it complements family income, possibly preventing destitution.This paper examines a dynamic laissez-faire economy in which child labor is endemic, andstudies a policy designed to...

The welfare state is not merely a stand-in for missing markets; it can do a whole lot more. When generations overlap and the young must borrow to make educational investments, a dynamically-efficient welfare state, by taxing the middle-aged and offering a compensatory old-age pension, can...

Three profound changes -- the mortality, fertility and contraception transitions -- characterized the Victorian era in England. Economists, following Becker (1960), focus on the first two and underplay the third by assuming couples can achieve their fertility target at no cost. The historical...

This paper studies the welfare of time-inconsistent, partially sophisticated agents living under two different regimes, one with complete, unfettered credit markets (CM) and the other with endogenous borrowing constraints (EBC) where the borrowing limits are set to make agents indifferent...