Bibliographic record and links to related information available from the Library of Congress catalog.
Note: Contents data are machine generated based on pre-publication provided by the publisher. Contents may have variations from the printed book or be incomplete or contain other coding.
Contents Acknowledgements xi Introduction xii 1 Demography 1 1.1 Fertility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1.2 Population projections . . . . . . . . . . . . . . . . . . . . . . 5 1.2.1 Projected age structures . . . . . . . . . . . . . . . . . 5 1.2.2 Old-age and total dependency ratios . . . . . . . . . . 10 1.3 Implications for public expenditure . . . . . . . . . . . . . . . 12 2 Public support for the old 24 2.1 Public pension schemes . . . . . . . . . . . . . . . . . . . . . . 25 2.2 Simple pension algebra . . . . . . . . . . . . . . . . . . . . . . 33 i ii 2.3 Public pension schemes in selected countries . . . . . . . . . . 40 2.3.1 US Social Security . . . . . . . . . . . . . . . . . . . . 42 2.3.2 UKNational Insurance . . . . . . . . . . . . . . . . . . 44 2.3.3 The German Gesetzliche Rentenversicherung . . . . . . 46 2.3.4 The French Régime Général . . . . . . . . . . . . . . . 49 2.3.5 The Italian Fondo Pensioni Lavoratori Dipendenti . . . 50 2.3.6 The Swedish public pension scheme . . . . . . . . . . . 53 2.3.7 The Japanese public pension scheme . . . . . . . . . . 56 2.4 Ageing and the tax implied in public pensions . . . . . . . . . 58 3 Public support for families and children 71 3.1 Cash benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 3.1.1 Monetary benefits for families with children . . . . . . 74 3.1.2 Parents with different numbers of children . . . . . . . 79 3.1.3 Parents with different earning abilities . . . . . . . . . 81 3.2 Benefits in-kind . . . . . . . . . . . . . . . . . . . . . . . . . . 86 3.2.1 Child care . . . . . . . . . . . . . . . . . . . . . . . . . 87 3.2.2 Schooling . . . . . . . . . . . . . . . . . . . . . . . . . 89 3.2.3 Health . . . . . . . . . . . . . . . . . . . . . . . . . . . 92 iii 4 Child-related elements in public pension schemes 101 4.1 The rules applied in selected countries . . . . . . . . . . . . . 102 4.1.1 United States . . . . . . . . . . . . . . . . . . . . . . . 105 4.1.2 UnitedKingdom . . . . . . . . . . . . . . . . . . . . . 107 4.1.3 Germany . . . . . . . . . . . . . . . . . . . . . . . . . . 108 4.1.4 France . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 4.1.5 Italy . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113 4.1.6 Sweden. . . . . . . . . . . . . . . . . . . . . . . . . . . 115 4.1.7 Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . 117 4.2 Asynopsis ofmeasures . . . . . . . . . . . . . . . . . . . . . . 118 4.2.1 Women¿s wage profiles and stylized biographies . . . . 120 4.2.2 Baseline case . . . . . . . . . . . . . . . . . . . . . . . 123 4.2.3 Alternative patterns of labour force participation . . . 128 4.2.4 Mothers with different earning ability . . . . . . . . . . 131 4.2.5 Mothers with different numbers of children . . . . . . . 134 5 Life-cycle adjustments and intergenerational transfers: theory 147 5.1 Aconstitutional theory of the family . . . . . . . . . . . . . . 151 5.1.1 No assets or credit markets . . . . . . . . . . . . . . . 154 iv 5.1.2 Assets and credit markets . . . . . . . . . . . . . . . . 156 5.1.3 Self-enforcing family constitutions . . . . . . . . . . . . 163 5.2 Public intervention . . . . . . . . . . . . . . . . . . . . . . . . 168 5.2.1 Pension policy . . . . . . . . . . . . . . . . . . . . . . . 168 5.2.2 Child benefits . . . . . . . . . . . . . . . . . . . . . . . 185 5.2.3 Male and female wage rates . . . . . . . . . . . . . . . 188 5.3 Uncertainty, personal services and altruism . . . . . . . . . . . 192 6 Life-cycle adjustments and intergenerational transfers: evidence 204 6.1 Micro-data evidence . . . . . . . . . . . . . . . . . . . . . . . 205 6.1.1 Intra-family transfers . . . . . . . . . . . . . . . . . . . 207 6.1.2 The effect of income on transfer behaviour . . . . . . . 210 6.1.3 The effect of credit rationing on transfer behaviour . . 213 6.2 Macro-data evidence . . . . . . . . . . . . . . . . . . . . . . . 220 6.2.1 Aggregate effects of pension and child benefit policy . . 222 6.2.2 AVARmodel forGermany . . . . . . . . . . . . . . . 225 7 Policy: what ought to be done? 237 7.1 Optimal policy in a simple framework . . . . . . . . . . . . . . 241 v 7.1.1 Social optima . . . . . . . . . . . . . . . . . . . . . . . 242 7.1.2 Laissez-faire equilibria . . . . . . . . . . . . . . . . . . 246 7.1.3 First-best pensions and child benefits . . . . . . . . . . 249 7.2 Human capital, uncertainty andmoral hazard . . . . . . . . . 253 7.3 Policy optimization as a principal-agent problem. . . . . . . . 257 7.3.1 Parents as government agents . . . . . . . . . . . . . . 258 7.3.2 The government as principal . . . . . . . . . . . . . . . 261 7.4 Pensions and child benefits in the presence of uncertainty and asymmetric information . . . . . . . . . . . . . . . . . . . . . 268 8 Policy: what can be done? 274 8.1 An early summing-up, and some policy options . . . . . . . . 278 8.2 Reducing pension coverage and raising child benefits . . . . . 285 8.2.1 Fertility effects . . . . . . . . . . . . . . . . . . . . . . 290 8.2.2 Saving effects . . . . . . . . . . . . . . . . . . . . . . . 292 8.3 Reforming the system. . . . . . . . . . . . . . . . . . . . . . . 294 8.3.1 Linking individual pension entitlements to individual fertility . . . . . . . . . . . . . . . . . . . . . . . . . . . 295 8.3.2 Linking individual pension entitlements to own children¿s earning ability . . . . . . . . . . . . . . . . . . . 299 vi Conclusion 310 Notes 318 References 364 List of Figures 1.1 Total fertility rates in major industrialized countries . . . . . . 18 1.2 Population pyramids (2000 and 2050) . . . . . . . . . . . . . . 19 1.3 Old-age dependency ratios (2000, 2025, and 2050) . . . . . . . 20 1.4 Total dependency ratios (2000, 2025, and 2050) . . . . . . . . 21 1.5 Old-age dependency using alternative fertility assumptions . . 22 2.1 Implicit taxes involved in public pension schemes . . . . . . . 69 2.2 Implicit taxes ¿ the case of Italy . . . . . . . . . . . . . . . . . 70 3.1 Child-related monetary benefits ¿ baseline cases . . . . . . . . 96 3.2 Child-related monetary benefits ¿ no. of children . . . . . . . 97 3.3 Child-related monetary benefits ¿ levels of earnings . . . . . . 98 4.1 Stylized earnings profiles of typicalmothers . . . . . . . . . . 139 4.2 Changes in net household wealth ¿ baseline scenario . . . . . . 140 vii viii 4.3 Changes in net household wealth for single mothers ¿ baseline scenario . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141 5.1 Themarginal player . . . . . . . . . . . . . . . . . . . . . . . 196 5.2 The Nash-frontier and the renegotiation-proof family constitution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 197 5.3 Effects of an actuarially fair pension scheme . . . . . . . . . . 198 5.4 Effects of a less than actuarially fair pension scheme (? 0) . 199 5.5 Effects of a more than actuarially fair pension scheme (? < 0) 200 5.6 Effects of child benefits on themarginal player . . . . . . . . . 201 5.7 Effects of themale wage rate . . . . . . . . . . . . . . . . . . . 202 5.8 Effects of the female wage rate . . . . . . . . . . . . . . . . . . 203 6.1 Transfersmade/received by age group. . . . . . . . . . . . . . 234 6.2 Transfersmade/received by type of transfer . . . . . . . . . . 235 6.3 Effects of credit rationing . . . . . . . . . . . . . . . . . . . . 236 7.1 Second-best transfer to parents, conditional on a child¿s earning capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . 273 8.1 Total fertility rates in Germany until 2020 ¿ simulations #1 . 303 8.2 Total fertility rates in Germany until 2020 ¿ simulations #2 . 304 ix 8.3 Saving rates inGermany until 2020 ¿ simulations#1 . . . . . 305 8.4 Saving rates inGermany until 2020 ¿ simulations#2 . . . . . 306 8.5 Total fertility rates in Germany until 2020 ¿ simulations #3 . 307 8.6 Saving rates inGermany until 2020 ¿ simulations#3 . . . . . 308 8.7 Total fertility rates in Germany until 2020 ¿ simulations #4 . 309 List of Tables 1.1 Age-related public expenditure and demographic change . . . 23 3.1 Day care for children at pre-school age . . . . . . . . . . . . . 99 3.2 Public expenditure on primary and secondary education . . . 100 4.1 Stylised biographies of women used in the simulations . . . . . 142 4.2 Net household wealth in the baseline scenario . . . . . . . . . 143 4.3 Changes in net household wealth ¿ alternative work records . . 144 4.4 Changes in net household wealth ¿ level of earnings . . . . . . 145 4.5 Changes in net household wealth ¿ number of children . . . . 146 6.1 Policy effects predicted by differentmodels . . . . . . . . . . . 232 6.2 Estimated social policy effects inGermany . . . . . . . . . . . 233
Library of Congress Subject Headings for this publication:
Family allowances.
Social security.
Family demography -- Economic aspects.
Child welfare.