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dc.contributor.authorKaul, Ashoken_US
dc.contributor.authorHagedorn, Marcusen_US
dc.contributor.authorBarbie, Martinen_US
dc.description.abstractWe develop a general equilibrium stochastic OLG model with heterogenous households. Households differ with respect to their productivity. Productivity depends stochastically on parents' unobservable investment in their child's human capital and an aggregate productivity shock. We introduce a PAYG social security system that conditions benefits on the aggregate wage sum and on the wage of one's child. We analyze the effects of such a social security system on the endogenous distribution of human capital and compare it to real world systems, which typically do not condition benefits on the wages of one's children. We decompose the effects of social security on the investment in human capital into an incentive effect, an insurance effect, a redistributive effect and a general equilibrium effect. Furthermore, we discuss the effects of social security on the long run distribution of human capital. Our approach suggests a novel role for a well-designed social security system: it can foster human capital accumulation and act as intragenerational insurance against human capital risk.en_US
dc.publisherInstitute for the Study of Labor (IZA) Bonnen_US
dc.relation.ispartofseriesIZA Discussion paper series 678en_US
dc.subject.keywordhuman capital formationen_US
dc.subject.keywordsocial securityen_US
dc.subject.keywordintragenerational insuranceen_US
dc.subject.keywordheterogenous householdsen_US
dc.subject.stwSoziale Sicherungen_US
dc.subject.stwOverlapping Generationsen_US
dc.subject.stwAllgemeines Gleichgewichten_US
dc.titleFostering Within-Family Human Capital Investment: An Intragenerational Insurance Perspective of Social Securityen_US
dc.typeWorking Paperen_US
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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