The answer is negative. The reason is that capital markets would most likely increase the present value of income thus increasing the demand for children as well as the demand for second-period consumption. The last chapter considers the effect of unequal income distribution among families on the optimality of the ailocation.
Here the authors choose the max-min social welfare function Rawls and show that child allowances are required in order to implement the optimal allocation as a competitive equilibrium. The epilog to the book contains several suggestions for extending the above model in order to analyze possible market failures and corrective policies. The book presents a general equilibrium demographic model and public finance analysis in an extremely clear and elegant style.
As such, I strongly recommend it as an additional text for a graduate course on development, growth and demographic theory. The issue of the optimal allocation of resources when fertility and population growth are endogenous is central to the understanding of economic development. An important contribution of the book for the analysis of population issues is the introduction of the concept of optimality of the LFA in chapters 6 and 7.
Household and economy: Welfare economics of endogenous fertility
This concept is based on the assumed interior solution for the optimization problem of the initial generation. While the authors are aware of the fact that the non-convexity of the budget constraint implies that a corner solution is possible for a standard utility function, they do not investigate the conditions on preferences that guarantee the existence of such a solution. In the example of the LFA p. It seems that one would like rather to find conditions on preferences that exclude this type of optimal allocation.
We could learn more if we knew the type of preferences that yield positive bequests and a positive number of children for each date. This is essential for the optimality of the LFA and for using the model as a positive theory of population growth. An important extension would be to characterize the dynamic allocation of the laissez-faire infinite horizon economy.
To do that one would have to find restrictions on preferences that yield interior solutions. Furthermore, the condition for the non-negativitiy of bequests in an economy with heterogeneous population is important for optimality considerations as well as for analyzing the effectiveness of government debt policy [e.
The arguments that the authors give to support their unconstrained bequest p. On the other hand, the authors argue that it is possible that one generation gets a positive bequest and another generation inherits debt. I am not convinced that these are reasonable assumptions for the same structure of the economy. One way to proceed in analyzing the dynamic model is to use a more restrictive form of endogenous fertility. This type of model together with land as a productive input, does not violate the optimality of the LFA in an OLG economy the Pareto effecient result in chapter 7, p.
Furthermore, this model has a standard budget set and the analysis proceeds in the same manner as in standard OLG models. In particular, the characterization of the dynamic allocation under different market structures is more manageable [see, for example, Eckstein and Wolpin ].
- Overlapping generations model.
- Multiple Danger.
- Endogenous fertility, altruistic behavior across generations, and social security systems?
- Who Shot JFK?.
- Household and economy: Welfare economics of endogenous fertility.
- The History of Mexico From Pre-Conquest to Present.
- Book Household And Economy Welfare Economics Of Endogenous Fertility 1987.
In this type of model the current generation would not internalize the effect of public goods that are provided to the future generations. However, there is no reason to expect that in a Malthusian economy the LFA would be non-optimal. The reason is that for such a dynastic economy one would expect the initial generation of parents to internalize the future decisions of all future families, including possible interaction among families.
Hence, the degree of altruism that is assumed in the model has important implications for the optimality of the LFA. Therefore, the most important extension of this book would be in characterizing the dynamic allocation under different specifications of preferences and technology. References Abel, Andrew B. Bernheim, B. Douglas and Kyle Bagwel, , Is everything neutral?
The implications of intergenerational altruism in an overlapping generations model with marriage, Mimeo.
Standford University, Stanford, CA. Ehrenberg, Ronald D. Introduction: Economics of the family. Topic 2: Mortality: Determinants and its effect on fertility. Topic 3: Household production function. Topic 4: Investments in human capital.
ES: chapter 9, pp. Using a static analytical framework to examine intra-generational distribution, the authors first focus on the skill composition of migrants in both free and restricted immigration policy regimes, drawing on empirical research from EU and non-EU states. The authors then offer theoretical analyses of similar issues in dynamic overlapping generations settings, studying not only intragenerational but also intergenerational aspects, including old-young dependency ratios and skilled-unskilled conflicts. Finally, they examine overall gains from or costs of migration in both host and source countries and the race to the bottom argument of tax competition between states in the presence of free migration.
The decline of the welfare state : demography and globalization by Assaf Razin 12 editions published in in English and held by 1, WorldCat member libraries worldwide "In The Decline of the Welfare State, Assaf Razin and Efraim Sadka use a political economy framework to analyze the effects of aging populations, migration, and globalization on the deteriorating system of financing welfare state benefits as we know them.
Their timely analysis, supported by a unified theoretical framework and empirical findings, demonstrates how the combined forces of demographic change and globalization will make it impossible for the welfare state to maintain itself on its present scale. Economic policy in the international economy : essays in honor of Assaf Razin by Assaf Razin 19 editions published between and in English and held by 1, WorldCat member libraries worldwide Annotation Fifteen major essays on international economics investigate five principal themes: theory, and empirics, of financial issues in open economies; economic growth; public economies; and political economy.
Written to honor Assaf Razin of Tel Aviv and Cornell Universities on the occasion of his sixtieth birthday, the essays pay close attention to policy issues and formal analysis. The contributors include renowned specialists in international economics based in North America, Europe, Israel, and China. Foreign direct investment : analysis of aggregate flows by Assaf Razin 18 editions published between and in English and held by WorldCat member libraries worldwide "The s saw global flows of foreign direct investment increase some sevenfold, spurring economists to explore FDI from a micro- or trade-based perspective.
Foreign Direct Investment is one of the first books to analyze the macroeconomics of FDI, treating FDI as a unique form of international capital flow between specific parts of countries. Drawing on a wealth of fresh data, they provide new theoretical models and empirical techniques that illuminate the vital country-pair characteristics that drive these flows.
Book Household And Economy. Welfare Economics Of Endogenous Fertility
Uniquely, Foreign Direct Investment examines FDI between developed and developing countries, and not just between developed countries. Among many other insights, the book shows that tax competition vis-a-vis FDI need not lead to a "race to the bottom". Foreign Direct Investment is an essential resource for graduate students, academics, and policy professionals. Population economics by Assaf Razin Book 13 editions published between and in English and held by WorldCat member libraries worldwide.
Public-private partnerships : a public economics perspective by Efraim Sadka 10 editions published in in English and held by WorldCat member libraries worldwide Public-private partnerships PPPs involve the supply by the private sector of infrastructure and services deriving from infrastructure assets which have traditionally been supplied by the public sector.
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PPPs are spreading all over the world. It may be quite plausible that such arrangements were initially an attempt to evade expenditure controls and hide public budget deficits. But if they are properly designed and transparently reported, PPPs can enhance the efficiency of the provision of services that were formerly supplied solely by the public sector. This paper provides a public economics perspective on PPPs. The economics of globalization : policy perspectives from public economics by Assaf Razin Book 19 editions published between and in English and held by WorldCat member libraries worldwide The increasing economic openness expressed in the globalization of independent economic systems has created problems as well as opportunities that cross formal borders in new and unexpected ways.