The transfer paradox in a one-sector overlapping generations model

Emily Cremers () and Partha Sen

Journal of Economic Dynamics and Control, 2008, vol. 32, issue 6, 1995-2012

Abstract: This paper examines the effects of international income transfers on capital accumulation and welfare in a one-sector overlapping generations model. It is shown that a strong form of the transfer paradox - in which the donor country experiences a welfare gain while the recipient country experiences a welfare loss - may occur both in and out of steady state. In addition, it is shown that a weak form of the transfer paradox - where either the donor or recipient (but not both) experiences a paradoxical welfare effect - may characterize all segments of the transition path not already characterized by the strong transfer paradox.

Date: 2008
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Related works:
Working Paper: The Transfer Paradox in a One-Sector Overlapping Generations Model (2010)
Working Paper: The Transfer Paradox in the One-Sector Overlapping Generations Model (2008)
Working Paper: The Transfer Paradox in a One-Sector Overlapping Generations Model (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:dyncon:v:32:y:2008:i:6:p:1995-2012

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