Borrowing constraints and two-sided altruism with an application to social security

Article Abstract:

The implications of intergenerational transfers, altruistic gift motives, and borrowing constraints are analysed for non-Ricardian situations. Six equilibrium configurations for linkages across time and generations are identified. In the case of altruistic child-to-parent motivation, it is proven that interest-rate neutrality holds for all lump-sum government interventions. Among the study results is the assertion that aggregate capital accumulation is significantly depressed by unfunded social security interventions.

Social security

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Long-run equilibria with borrowing constraints and altruism

Article Abstract:

A nonstochastic overlapping generations model with liquidity constraints and intergenerational altruism is analyzed. The model focuses on the interaction of both variables. It is shown that both factors exhibit a tendency to conflict, where equilibrium conditions did not necessarily combine with dynastic wealth accumulation. In addition, the model exhibited a greater tendency towards equilibrium with binding constraints and absent dynastic accumulation.

Loans, Equilibrium (Economics)

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The timing of intergenerational transfers, tax policy, and aggregate savings

Article Abstract:

Research was conducted to study overlapping-generations models, the effects of borrowing and lending rates on intergenerational transfers, the long-term effects of taxation of labor income on aggregate savings and the effects of tax policy on savings. The results proved the invariance of the steady-state marginal product of capital to government spending, government debt, labor-income taxation and capital-income taxation.

Interest rates, Savings, Fiscal policy

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