Multiple Equilibria between Fertility Rates and Pension Levels Based on the Target Level of Government Debt

.
DOI: 10.4236/tel.2011.13020   PDF   HTML     5,376 Downloads   8,943 Views   Citations

Abstract

We show that when the government has a target debt level, multiple equilibria exist in the relationship between fertility rates and pension levels. One is associated with a high fertility rate and a high pension level. The other is associated with a low fertility rate and a low pension level. If the government fails to provide adequate security for individuals during their retirement years, it would result in a failure of coordination between the government and individuals.

Share and Cite:

H. Nakamura and M. Yasuoka, "Multiple Equilibria between Fertility Rates and Pension Levels Based on the Target Level of Government Debt," Theoretical Economics Letters, Vol. 1 No. 3, 2011, pp. 95-98. doi: 10.4236/tel.2011.13020.

Conflicts of Interest

The authors declare no conflicts of interest.

References

[1] J. Zhang, “Social Security and Endogenous Growth,” Journal of Public Economics, Vol. 58, No. 2, 1995, pp. 185-213. doi:10.1016/0047-2727(94)01473-2
[2] B. V. Groezen, T. Leers, L. Meijdam, “Social Security and Endogenous Fertility: Pension and Child Allowances as Siamese Twins,” Journal of Public Economics, Vol. 87, No. 2, 2003, pp. 233-251. doi:10.1016/S0047-2727(01)00134-7
[3] B. V. Groezen, L. Meijdam, “Growing Old and Staying Young: Population Policy in an Aging Closed Economy,” Journal of Population Economics, Vol. 21, No. 3, 2008, pp. 573-588. doi:10.1007/s00148-006-0067-x
[4] M. Hirazawa, A. Yakita, “Fertility, Child Care Outside the Home, and Pay-as-You-Go Social Security,” Journal of Population Economics, Vol. 22, No. 3, 2009, pp. 565- 583. doi:10.1007/s00148-007-0153-8
[5] K. Futagami, T. Iwaisako, R. Ohdoi, “Debt Policy Rule, Productive Government Spending, and Multiple Growth Paths,” Macroeconomic Dynamics, Vol. 12, No. 4, 2008, pp. 445-462. doi:10.1017/S1365100508070235
[6] [1] T. Ono, “Social Security Policy with Public Debt in an Aging Economy,” Journal of Population Economics, Vol. 16, No. 2, 2003, pp. 363-387.

  
comments powered by Disqus

Copyright © 2020 by authors and Scientific Research Publishing Inc.

Creative Commons License

This work and the related PDF file are licensed under a Creative Commons Attribution 4.0 International License.