Campus Units

Economics

Document Type

Article

Publication Version

Submitted Manuscript

Publication Date

2-2016

Journal or Book Title

Journal of Monetary Economics

Volume

77

First Page or Article ID Number

103

Last Page

124

DOI

10.1016/j.jmoneco.2015.10.007

Abstract

Dynastic altruistic models with endogenous fertility have been shown to be unable to generate enough intergenerational persistence. Using a Bewley model with endogenous fertility we show that it is possible to recover persistence. Key ingredients for our result include exponential child discounting, discrete number of children, diminishing costs of child rearing, and an elasticity of intergenerational substitution larger than one. Our model provides a unified framework of analysis for long-run inequality that incorporates fertility choices.

JEL Classification

E24, J13

Comments

NOTICE: this is the author’s version of a work that was accepted for publication in Journal of Monetary Economics. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in Journal of Monetary Economics [77, (2016)] DOI: 10.1016/j.jmoneco.2015.10.007.

Copyright Owner

Elsevier B.V.

Language

en

File Format

application/pdf