Altruism and Self-Restraint

David de la Croix and Philippe Michel

Annals of Economics and Statistics, 2001, issue 63-64, 233-259

Abstract: Parental altruism plays a particular role when standard-of-living aspirations are transmitted from one generation to the next. The influence of altruistic parents is not limited to the bequest they could leave; they also direct the evolution of children's aspirations by restraining their own consumption standard. We show that, even if there is no bequest, altruism always increases capital accumulation and has a stabilizing effect on the economy. However, its effect on steady state welfare can be negative. Inherited standard-of-living can also generate regime shifts (bequest/no bequest) along the equilibrium path.

Date: 2001
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Persistent link: https://EconPapers.repec.org/RePEc:adr:anecst:y:2001:i:63-64:p:233-259

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