Mitigating Demographic Risk Through Social Insurance
Jerry R. Green,Jerry R. Green +1 more
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In this paper, a two-period lifetime overlapping generations growth model is used to evaluate the possibility that social insurance can effectively offset economic risks associated with uncertainty about the rate of population growth.Abstract:
A two-period lifetime overlapping generations growth model is used to evaluate the possibility that social insurance can effectively offset economic risks associated with uncertainty about the rate of population growth. Crude measures of the seriousness of this type of risk in the current United States situation are presented. Sufficient conditions on the structure of the economy for such intergenerational risk pooling to be mutually beneficial to all members of society are derived. Although it is logically possible to satisfy them1 we argue that they are unlikely to be realized empirically in an economy similar to that of the United States. Because of this failure, some more complex types of policy options are also discussed.read more
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Intergenerational Risk Sharing
Roger H. Gordon,Hal R. Varian +1 more
TL;DR: In this article, the authors argue that in designing government debt and tax-transfer policies, it is important to consider their implications for the allocation of risk between generations, implying that stochastic government policies have the potential to create first-order welfare improvements.
Risk Aspects of Investment-Based Social Security Reform: Introduction
TL;DR: In this paper, the authors evaluate the magnitude of the risks that both retirees and taxpayers would assume and show that the risk is actually moderate relative to the improved return, as well as being balanced by the ability of an investment-based system to adapt to differences in individual preferences and conditions.
ReportDOI
12. On the Role of Social Security as a Means for Efficient Risk Sharing in an Economy Where Human Capital Is Not Tradable
TL;DR: In this article, an intertemporal general equilibrium model of an economy with overlapping generations and two factors of production, labor and capital, is used to analyze the economic inefficiencies caused by the non-tradeability of human capital.
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Intergenerational transfers as social insurance
TL;DR: In an overlapping-generations model with stochastic population changes, a social security scheme with a fixed level of payments to the retired can be interpreted as providing social insurance against the risks of demographic change as discussed by the authors.
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The optimum structure for government debt
TL;DR: In this paper, the structural differences between implicit and explicit government debt in a two-generations-overlapping model with stochastic factor-prices were studied, and it was shown that there will always exist a simple intertemporal compensation mechanism which allows to reconcile these conflicting interests.
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Are Government Bonds Net Wealth
TL;DR: In this article, the authors consider the effects of different types of intergenerational transfer schemes on the stock of public debt in the context of an overlapping-generations model and show that finite lives will not be relevant to the capitalization of future tax liabilities so long as current generations are connected to future generations by a chain of operative inter-generational transfers.
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An Exact Consumption-Loan Model of Interest with or without the Social Contrivance of Money
TL;DR: This article developed the equilibrium conditions for a rational consumer's lifetime consumption-saving pattern, a problem more recently given by Harrod the useful name of "hump saving" but which Landry, Bbhm-Bawerk, Fisher, and others had touched on long before my time.
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Perceived Wealth in Bonds and Social Security: A Comment
TL;DR: Barro as discussed by the authors showed that the existence of such voluntary intergenerational transfers does not have the striking implication that Barro asserts, but instead follows instead from restrictive and empirically unwarranted assumptions.
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Taxation, Saving and the Rate of Interest
TL;DR: In this paper, a variety of functional forms, estimation methods and definitions of the real after-tax rate of return invariably lead to the conclusion of a substantial interest elasticity of saving.