期刊名称：CORE Discussion Papers / Center for Operations Research and Econometrics (UCL), Louvain
出版年度：2011
卷号：2011
期号：1
出版社：Center for Operations Research and Econometrics (UCL), Louvain
摘要：If raising and educating children is a private cost to households, while the
availability of skilled labor supply resulting from the households’ fertility and
education choices is a public good, then competitive equilibria typically deliver a
suboptimal mix of size and skills of the population. In particular, households would
underinvest in their children education compared to the optimal level. This is the
case even if households are aware of the increase in savings returns implied by a
higher supply of skilled labor and manage to coordinate to try to exploit this effect.
In a setup devoid of altruistic motives, this paper shows that a tax - financed
compulsory education is unlikely to implement the optimal steady state, even if the
mandatory level of education is the optimal one (the system of equations is
overdetermined). Nevertheless, a pensions scheme that makes payments contingent
to the household fertility and investment in its children’s education can implement
the first- best steady state. The pension scheme is balanced period by period by
financing pensions through a payroll tax on the increase in children’s labor income
resulting from their parents’ human capital investment.
