Demography and Uncertainty in Economic Growth: An Application to Social Security

Miguel Sánchez-Romero

Cuadernos de Economía - Spanish Journal of Economics and Finance, 2007, vol. 30, issue 83, 027-056

Abstract: The aim of this paper is to study the impact on economic growth of public pension systems, both funded and unfunded, under different demographic scenarios with a competitive economy and a fixed labor supply. An OLG growth model is used with realistic demography, in which each individual can be traced throughout her lifecycle, by using a longitudinal accounting framework. Under this setup, I find that both funded and unfunded pension systems can achieve the same steady state, either the «modified golden rule» or the «golden rule,» as long as the population increases. Nonetheless, the dynamic transition of each social security system to this steady state differs. This result shows that when labor supply is inelastic public pension systems do not necessarily alter the capital stock in the long run.

Keywords: Overlapping generations; Demography; Multiple equilibria; Social Security; Crowding-out effect (search for similar items in EconPapers)
JEL-codes: D9 E13 E27 H55 O40 (search for similar items in EconPapers)
Date: 2007
References: Add references at CitEc
Citations:

Downloads: (external link)
https://repositorio.uam.es/bitstream/handle/10486/4508/30021_83_02.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cud:journl:v:30:y:2007:i:83:p:027-056

Access Statistics for this article

More articles in Cuadernos de Economía - Spanish Journal of Economics and Finance from Asociación Cuadernos de Economía
Bibliographic data for series maintained by Erick Tinsson ().