Essays on intergenerational transfers
Abstract
This dissertation considers the welfare effects of interfamily and intergenerational transfers on both micro and macro levels. The focus has been on how lifetime uncertainty and altruistic transfer motives affect the individual's consumption and saving behavior. Publicly provided annuity bonds can be welfare improving. However, whether it provides a better scheme than social security depends on the choice of tax and per capita bond holdings. Social security has many advantages over annuity bonds, and is Pareto-improving. Gifts increase both consumption and savings, but reduce inequality. The introduction of social security in the presence of gifts is Pareto-improving. The effects of voluntary bequests are ambiguous. However, social security increases the efficiency of the bequest economy. It is shown that the standard results regarding the Ricardian Equivalence holds when we eliminate uncertainty from the model. Therefore, the effects of uncertainty can be measured by comparing this model with certainty case.
Degree
Ph.D.
Advisors
Hu, Purdue University.
Subject Area
Economic theory
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