Administrative Bureaus with Standard Operating Procedures

We investigate the terms of exchange between the legislative branch of the government and an administrative bureau with standard operating procedures. An administrative bureau is a not-for-profit public organisation responsible for the production of a non-marketable good. Such a bureau is tax-financed and the budget appropriations can be linked directly to a verifiable measure of the agency's performance. Also, the tax-financed transfer must not be less than the monetary cost of running the public agency. When standard operating procedures are central to the workings of the bureau, the agency is unencumbered by moral hazard. Yet, such agency is likely to have superior information over its production technology relative to the legislature. In such an information environment, we focus on how the legislature could minimise its welfare losses. Our results come in striking contrast to those in the literature on bureaucracies and to the received adverse selection findings. In a setting where the agency can be either of two cost-types, the principal finds it optimal in most cases to distort the production performance of the beureau regardless of its cost-type. Also the distortions are not of the same direction.bureaucracy, non profit organisations, adverse selection

An OLG Model of Endogenous Growth and Ageing

To study fully endogenous ageing alongside growth and their implications, this paper sets up an OLG economy in which the life expectancy of agents is endogenous. Agents are bearers of children, investors in education and producers and consumers of output. Retirement decision in the last period of life is also endogenous and, when retired, agents receive a pension that is nanced by a PAYG system. The model features a unique asymptotically stable steady state. Accordingly it supports a plethora of short and medium-run dynamic paths to a uniquely dened long-run equilibrium depending on the functional forms, parameters and initial conditions. The model is then calibrated and some comparative static experiments on the e ect of policy variables changes are conducted.Ageing, Fertility, Growth and Longevity.

An OLG Model of Endogenous Growth and Ageing

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