A competitive growth model with endogenous fertility

This paper investigates the interaction between endogenous fertility behavior and the distribution of income and wealth arnong farnilies in a competitive market economy. We construct a growth model in which altruistic dynasties are heterogeneous in their initial stocks of physical capital. Dynasties make choices of farnily size along with decisions about consumption and intergenerational transfers. We show that if the rate of time preference is increasing in the number of children and preferences over nurnber of children satisfy a norrnality assumption, all steady states are characterized by equality of capital stocks and consumption arnong families. We also provide sufficient conditions for uniqueness of the steady state. In order to illustrate these results, we present an example in which preferences over number of children are logarithrnic and the technology is Cobb-Douglas. For this combination of preferences and technology, there exists a unique egalitarian steady state. Moreover, the economy converges to this steady state in only one generation .

The impact of social security reform on occupational and retirement behavior : a quantitative assessment for Brazil

Population ageing is a problem that countries will have to cope with within a few years. How would changes in the social security system affect individual behaviour? We develop a multi-sectoral life-cycle model with both retirement and occupational choices to evaluate what are the macroeconomic impacts of social security reforms. We calibrate the model to match 2011 Brazilian economy and perform a counterfactual exercise of the long-run impacts of a recently adopted reform. In 2013, the Brazilian government approximated the two segregated social security schemes, imposing a ceiling on public pensions. In the benchmark equilibrium, our modelling economy is able to reproduce the early retirement claiming, the agents' stationary distribution among sectors, as well as the social security deficit and the public job application decision. In the counterfactual exercise, we find a significant reduction of 55\% in the social security deficit, an increase of 1.94\% in capital-to-output ratio, with both output and capital growing, a delay in retirement claims of public workers and a modification in the structure of agents applying to the public sector job.