Document Type

Working Paper

Publication Date

2-10-2012

Working Paper Number

WP #34912, February 2012

Abstract

A classic result in dynamic public economics states that there is no welfare rationale for pay-as-you-go (PAYG) pensions in a dynamically-efficient neoclassical economy with exogenous labor supply. Parenthetically, a welfare justification for PAYG pensions exists if the economy is dynamically inefficient. Under a sufficient condition that the old be no less risk-averse than the young, these results extend to an economy with endogenous labor supply.

Publication Status

Published in Macroeconomic Dynamics, Vol. 17 no. 5 (July 2013): 971-997. http://dx.doi.org/10.1017/S1365100511000794

JEL Classification

E6, H3

File Format

application/pdf

Length

61 pages

File Function

This version: February 10, 2012 (Original version: December 8, 2009).

Included in

Economics Commons

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