Estimating the Effects of Social Security Reform: an Euler-equation Approach
نویسنده
چکیده
This paper shows theoretically and empirically that an aggregate Euler equation relates the real interest rate to the growth rate of per capita consumption and the ratio of private and social security wealth plus asset income to consumption. Using the estimated Euler equation, the paper then calculates the steady-state effects of social security reform. Reforms that reduce the ratio of social security wealth to consumption are found to shift the balanced growth paths for the capital stock, output, and consumption upward appreciably. JEL Codes: E21, E62, H31
منابع مشابه
Consumer Behavior in the United States: Implications for Social Security Reform
This paper shows theoretically and empirically that an aggregate Euler equation relates the growth rate of per capita consumption to the real interest rate, the ratio of private wealth plus asset income to consumption, and the ratio of social security wealth to consumption. Using the estimated Euler equation, the paper then calculates the steady-state effects of social security reform. Reforms ...
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