Intergenerational Altruism and Neoclassical Growth Models

69 Pages Posted: 6 Jan 2005

See all articles by Philippe Michel

Philippe Michel

National Center for Scientific Research (CNRS) - GREQAM (Deceased)

Emmanuel Thibault

University of Toulouse 1 - Toulouse School of Economics (TSE)

Jean-Pierre Vidal

European Central Bank (ECB)

Date Written: August 2004

Abstract

This paper surveys intergenerational altruism in neoclassical growth models. It first examines Barro's approach to intergenerational altruism, whereby successive generations are linked by recursive altruistic preferences. Individuals have an altruistic concern only for their children, who in turn also have altruistic feelings for their own children. The conditions under which the Ricardian equivalence (debt neutrality) theorem applies are specified. The effectiveness of fiscal policy is further analysed in the context of an economy populated by heterogeneous families differing with respect to their degree of intergenerational altruism. Other forms of altruism, referred to as ad hoc altruism, are also examined, along with their implications for fiscal policy.

Keywords: Neoclassical general aggregative models, Altruism, Fiscal Policy

JEL Classification: E13, D64, E62, C60

Suggested Citation

Michel, Philippe and Thibault, Emmanuel and Vidal, Jean-Pierre, Intergenerational Altruism and Neoclassical Growth Models (August 2004). Available at SSRN: https://ssrn.com/abstract=576024 or http://dx.doi.org/10.2139/ssrn.576024

Philippe Michel

National Center for Scientific Research (CNRS) - GREQAM (Deceased)

Emmanuel Thibault (Contact Author)

University of Toulouse 1 - Toulouse School of Economics (TSE) ( email )

Place Anatole-France
Toulouse Cedex, F-31042
France

Jean-Pierre Vidal

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

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