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Pension policies in a model with endogenous fertility

Published online by Cambridge University Press:  31 May 2018

GIAM PIETRO CIPRIANI
Affiliation:
Department of Economics, University of Verona and IZA, Verona, Italy (e-mail: [email protected])
FRANCESCO PASCUCCI
Affiliation:
Department of Economics, University of Verona, Verona, Italy

Abstract

We set up an overlapping-generations model with endogenous fertility to study pensions policies in an ageing economy. We show that an increasing life expectancy may not be detrimental for the economy or the pension system itself. On the other hand, conventional policy measures, such as increasing the retirement age or changing the social security contribution rate could have undesired general equilibrium effects. In particular, both policies decrease capital per worker and might have negative effects on the fertility rate, thus exacerbating population ageing.

Type
Article
Copyright
Copyright © Cambridge University Press 2018 

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