Demographic structure and capital accumulation

This paper develops an overlapping-generations (OLG) model to analyze the consequences of demographic structure changes induced by an exogenous shift in the birth rate.We first show that a finite growth rate of the population that maximizes long-run capital per capita exists. Then, we examine the theoretical properties of this growth rate by showing that: (i) it corresponds to the demographic structure such that the average ages of capital holders and workers are equal; (ii) it is associated to an efficient steady state; (iii) it increases with compulsory transfers from younger to older generations. Finally, we explain why standard OLG models do not exhibit such a growth rate.Continuous-time overlapping-generations models; Population aging

Parental altruism, life expectancy and dynamically inefficient equilibria

Macrodynamic models with finite lifetime and selfish individuals may feature (dynamically) inefficient equilibria, while models with infinite lifetime and altruistic individuals cannot. Do strong intergenerational altruism and high life expectancy prevent the occurence of inefficient equilibria? To answer this question, we present a continuous time OLG model which generalizes the Blanchard-Buiter-Weil model. Our main innovation relies on the introduction of parental altruism, whose intensity is variable. We show that parental altruism and life expectancy actually favor overaccumulation. Theoretical results are illustrated by a parametrization from US data. Our numerical exercises suggest that the US economy is dynamically inefficient, mainly because life expectancy is sufficiently short.Overlapping generations model; Productive capital; Dynamic (in)efficiency; Intergenerational altruism

Demographic structure and capital accumulation

International audienceThis paper develops an overlapping-generations (OLG) model to analyze the consequences of demographic structure changes induced by an exogenous shift in the birth rate.We first show that a finite growth rate of the population that maximizes long-run capital per capita exists. Then, we examine the theoretical properties of this growth rate by showing that: (i) it corresponds to the demographic structure such that the average ages of capital holders and workers are equal; (ii) it is associated to an efficient steady state; (iii) it increases with compulsory transfers from younger to older generations. Finally, we explain why standard OLG models do not exhibit such a growth rate

La croissance démographique dans les modèles à générations imbriquées

Dans cet article, nous proposons un modèle à générations imbriquées en temps continu pour étudier la relation entre le taux de croissance de la population et le taux d'intérêt. Nous montrons qu'il existe un taux de croissance fini de la population qui minimise le taux d'intérêt. Ceci implique que la relation entre ces deux variables n'est pas monotone. Nous proposons une caractérisation théorique du taux de croissance minimisant le taux d'intérêt et expliquons pourquoi les modèles à générations imbriquées standards de Diamond [1965] et Blanchard [1985] conduisent à une relation systématiquement croissante entre le taux de croissance de la population et le taux d'intérêt.