The political intergenerational welfare state

Authors

Monisankar Bishnu, Indian Statistical Institute (Delhi Centre)
Min Wang, Peking University

Article Type

Research Article

Publication Title

Journal of Economic Dynamics and Control

Abstract

Using a three-period overlapping generations economy framework, we characterize an intergenerational welfare state with endogenous education and pension under voting. We show that although politically establishing Pay-As-You-Go (PAYG) social security in isolation in a dynamically efficient economy will always reduce the capital investment and therefore the social welfare as expected, in contrast politically implementing education-pension policy package instead can improve both human and physical capital accumulation and social welfare over laissez faire. However for this the political influence of the old has to be small thus limiting the size of the PAYG social security program.

First Page

93

Last Page

110

DOI

10.1016/j.jedc.2017.02.002

Publication Date

4-1-2017

Comments

Open Access, Green

Recommended Citation

Bishnu, Monisankar and Wang, Min, "The political intergenerational welfare state" (2017). Journal Articles. 2619.
https://digitalcommons.isical.ac.in/journal-articles/2619