Fertility-related pensions and cyclical instability

Fertility-related pensions and cyclical instability

In this paper, we study a general equilibrium model with overlapping generations, endogenous fertility and public pensions. By assuming Cobb– Douglas technology and logarithmic preferences, we show that the introduction of a fertility-related component in the pay-as-you-go pension scheme may destabilise the long-term equilibrium and cause endogenous fluctuations when individuals have static exp...

Pensions with heterogenous individuals and endogenous fertility ∗

This paper studies the design of pension schemes in a society where fertility is endogenous and parents differ in their ability to raise children. In a world with perfect information, a pay-as-you-go social security system is characterized by equal pensions for all but different contributions which may or may not increase with the number of children. Additionally, fertility must be subsidized a...

Pensions with endogenous and stochastic fertility∗

This paper studies the design of a pay-as-you-go social security system in an overlapping generations model where fertility is in part stochastic and in part determined through capital investment. If investments are publicly observable, pension benefits must be linked positively to the level of investment, and payroll taxes negatively to the number of children. The outcome is characterized by f...

Structural financial instability and cyclical fluctuations

This paper introduces and discusses an heuristic model meant to clarify why and how economic instability may play a crucial role in a modern sophisticated monetary economy. In this model economic instability is specified in terms of structural instability rather than in the usual terms of dynamic instability. This different view of instability implies a different approach to the analysis of the...

Public Pensions and Demographic Changes in Developed Countries: Migration Boom and Fertility Bust?