Seminar Papers, Institute for International Economic Studies, Stockholm University
Strategic Saving and Non-Negative Gifts
Abstract: O'Connell and Zeldes (1993) have shown that the dynamic
inefficiency result of a standard gift model is reversed if parents can
undersave strategically. I impose an explicit non-negativity constraint on
gifts, which - for all numerical examples suggested by O'Connell and Zeldes
- alters this result, by making gifts non-operative. However, for other
realistic numerical examples, this is not the case.
Keywords: Dynamic efficiency; Altruism; Gifts; Overlapping generations; Saving; (follow links to similar papers)
JEL-Codes: D91; H31; (follow links to similar papers)
20 pages, October 31, 1997
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