SFB 303 Discussion Paper No. A - 347


Author: Peters, Wolfgang
Title: Public Pensions, Family Allowances and Endogenous Growth
Abstract: A tax-transfer system deals with redistribution among generations and corrective taxation at the same time. Since such a policy is a governments' task, we deal with a normative approach. Which tax-transfer system should a government apply to maximize social welfare? Our framework allows for endogenous dynamic effects which are mostly treated as exogenous developments: first, demographic aspects have a great impact on a pay- as-you-go (PAYG) financed pension insurance; and second, through education human capital is accumulated. Education influences the productivity of an individual's labor force - this directly corresponds to the wage rate which depends on the endogenous technical progress originated by education.
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Creation-Date: December 1991
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