Intergenerational altruism and the transfer paradox in an overlapping generations model

Kojun Hamada and Mitsuyoshi Yanagihara

The Quarterly Review of Economics and Finance, 2016, vol. 59, issue C, 161-167

Abstract: This study investigates how intergenerational altruism affects the possibility of the transfer paradox occurring in a two-country, one-sector overlapping generations model. We derive the conditions under which the transfer paradox occurs in our model where a generation within each country has altruism toward the subsequent generation. Contrary to earlier results in the literature, we find that altruism does not enter the conditions under which the transfer paradox occurs in the steady state. Moreover, we show that although altruism affects the condition of the transfer paradox along the transition path, its effect on this condition vanishes as the economy converges to the steady state.

Keywords: Intergenerational altruism; Transfer paradox; Overlapping generations model (search for similar items in EconPapers)
JEL-codes: D64 E22 F11 F35 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:quaeco:v:59:y:2016:i:c:p:161-167

DOI: 10.1016/j.qref.2015.04.001

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