To study fully endogenous aging alongside growth and their implications, this paper sets up an OLG economy in which life expectancy of agents is endogenous. Agents are bearers of children, investors in education and producers and consumers of output. Retirement decision is endogenous and agents receive a PAYG pension. The model features an unique asymptotically stable steady state. Accordingly it supports a plethora of short and medium run dynamic paths to a uniquely defined long run equilibrium. The model is then calibrated and some comparative static experiments on the effects of policy variables changes are conducted.
An OLG Model of Endogenous Growth and Ageing
CIPRIANI, Giam Pietro;
2001-01-01
Abstract
To study fully endogenous aging alongside growth and their implications, this paper sets up an OLG economy in which life expectancy of agents is endogenous. Agents are bearers of children, investors in education and producers and consumers of output. Retirement decision is endogenous and agents receive a PAYG pension. The model features an unique asymptotically stable steady state. Accordingly it supports a plethora of short and medium run dynamic paths to a uniquely defined long run equilibrium. The model is then calibrated and some comparative static experiments on the effects of policy variables changes are conducted.
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