dc.contributor.author |
Bandyopadhyay, Debasis |
en |
dc.contributor.author |
La Pere, A |
en |
dc.date.accessioned |
2020-04-08T02:23:38Z |
en |
dc.date.issued |
2020 |
en |
dc.identifier.issn |
0264-9993 |
en |
dc.identifier.uri |
http://hdl.handle.net/2292/50264 |
en |
dc.description.abstract |
We argue that parents underinvest in growing their own children's capability in the absence of property right over their future income, and that causes economic waste. No amount of collaborative choice among contemporary adults for public education could eliminate it because they face a resource constraint set by their predecessors. Such intergenerational dependence requires an intergenerational contract instead. It involves rewarding parents with a pension premium tied to their own children's taxable income paired with a matching subsidy to parental expenditure. We show how it fully internalizes the intergenerational externality, related to parenting, to eliminate economic waste and, thereby, to raise labor productivity and economic welfare. Our quantitative analysis of a baseline economy reveals significant welfare gains in economies with population ageing coupled with a low degree of parental care for children's future welfare and high returns to parental expenditure on children. |
en |
dc.publisher |
Elsevier |
en |
dc.relation.ispartofseries |
Economic Modelling |
en |
dc.rights |
Items in ResearchSpace are protected by copyright, with all rights reserved, unless otherwise indicated. Previously published items are made available in accordance with the copyright policy of the publisher. |
en |
dc.rights.uri |
https://researchspace.auckland.ac.nz/docs/uoa-docs/rights.htm |
en |
dc.title |
Raising productivity with pension premium |
en |
dc.type |
Journal Article |
en |
dc.identifier.doi |
10.1016/j.econmod.2020.01.009 |
en |
dc.rights.holder |
Copyright: The author |
en |
dc.rights.accessrights |
http://purl.org/eprint/accessRights/RestrictedAccess |
en |
pubs.subtype |
Article |
en |
pubs.elements-id |
793320 |
en |
pubs.org-id |
Business and Economics |
en |
pubs.org-id |
Economics |
en |
pubs.record-created-at-source-date |
2020-01-30 |
en |
pubs.online-publication-date |
2020-01-18 |
en |