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Forward Guidance in a Simple Model with a Zero Lower Bound

Illing, Gerhard - 2014

In this paper we present a three period setup to model central bank forward guidance in a liquidity trap. We analyze the role of long-run and short-run price stickiness under discretion and commitment in a straightforward and intuitive way. Despite the impact of price rigidity on welfare being...

Persistent link: https://www.econbiz.de/10013055395

Efficient Subsidization of Human Capital Accumulation with Overlapping Generations and Endogenous Growth

Richter, Wolfram F. - 2010

This paper studies second best policies for education, saving, and labour in an OLG model in which endogenous growth results from human capital accumulation. Government expenditures have to be financed by linear instruments so that growth equilibria are inefficient. The inefficiency is...

Persistent link: https://www.econbiz.de/10013146790

Aging, the Great Moderation and Business-Cycle Volatility in a Life-Cycle Model

Heer, Burkhard - 2014

According to empirical studies, the life cycle of labor supply volatility exhibits a U-shaped pattern. This may lead to the conclusion that demographic change induces a drop in output volatility. We present an overlapping generations model that replicates the empirically observed pattern and...

Persistent link: https://www.econbiz.de/10013059476

Longevity and Aggregate Savings

Sheshinski, Eytan - 2021

For the last fifty years, countries in Asia and elsewhere witnessed a surge in aggregate savings per capita. Some … argued that the rise in savings is short-run, eventually to be dissipated by the dissaving of the elderly, whose proportion … theory. A model of life cycle decisions with uncertain survival is used to derive individuals' consumption and chosen …

Persistent link: https://www.econbiz.de/10013317371

Fiscal Multipliers and the Choice of Zero Lower Bound Modeling

Siemsen, Thomas - 2013

In this note we elaborate on the effect of the modeling choice of the zero lower bound on the size of the fiscal multiplier. To this end we contrast two different ways to implement the ZLB in a New Keynesian model: the ZLB modeled as an endogenous central bank reaction to a contractionary demand...

Persistent link: https://www.econbiz.de/10013078525

Coordinating Intergenerational Redistribution and the Repayment of Public Debt

March, Christoph - 2016

Is there a link between public debt and wealth inequality? Could government bondholders use intra-generational redistribution strategically to make the repayment of debt politically viable? Using a two-generations game-theoretic model, we identify coordination and divide-and-conquer as key...

Persistent link: https://www.econbiz.de/10012980578

Resolving Intergenerational Conflict Over the Environment Under the Pareto Criterion

Andersen, Torben M. - 2016

We describe a “business as usual” (BAU) economy in which pollution is a by-product of productive activity by the current generation but “damages” production for future generations. Over time, conditions in the BAU economy become dire: it gets increasingly polluted, consumption falls and...

Persistent link: https://www.econbiz.de/10012981351

The Welfare Gains of Age Related Optimal Income Taxation

Bastani, Spencer - 2010

Using a calibrated overlapping generations model we quantify the welfare gains of an age dependent income tax. Agents face uncertainty regarding future abilities and can by saving transfer consumption across periods. The welfare gain of switching from an age-independent to an age-dependent...

Persistent link: https://www.econbiz.de/10013136607

The Tragedy of Annuitization

Heijdra, Ben J. - 2010

We construct a tractable discrete-time overlapping generations model of a closed economy and use it to study government redistribution of accidental bequests and private annuities in general equilibrium. Individuals face longevity risk as there is a positive probability of passing away before...

Persistent link: https://www.econbiz.de/10013139630

Coordinated Tax-Tariff Reforms, Informality, and Welfare Distribution

Ligthart, Jenny E. - 2010

The paper studies the revenue, efficiency, and distributional implications of a simple strategy of offsetting tariff reductions with increases in destination-based consumption taxes so as to leave consumer prices unchanged. We employ a dynamic micro-founded macroeconomic model of a small open...

Persistent link: https://www.econbiz.de/10013141409