On the relationship between fertility and public national debt

Luciano Fanti and Luca Spataro

Economic Modelling, 2013, vol. 33, issue C, 843-849

Abstract: Public debt and fertility are two issues of major concern in the current economic policy debate, especially in countries with below-replacement-fertility and large debt (which appears further enlarged as a consequence of the recent world financial distress 2008–2009). In this paper we show that, at the steady state, public debt is in general harmful for fertility, in that debt issuing almost ever crowds fertility. The relationship is however reversed if debt is sufficiently low and the share of capital (labor) in the economy is sufficiently low (high). Hence, our analysis would recommend that developed, capital intensive economies (such as OECD countries) aiming at a fertility recovery should reduce national debt, while developing, labor intensive economies, aiming at reducing fertility, should increase (reduce) national debt only if they are debt virtuous (vicious).

Keywords: Overlapping generations; Endogenous fertility; Debt (search for similar items in EconPapers)
JEL-codes: D91 E62 H63 J13 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:33:y:2013:i:c:p:843-849

DOI: 10.1016/j.econmod.2013.06.003

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