Journal of Economic Theory and Econometrics: Journal of the Korean Econometric Society
Home

About this journal
   Aims and scope

   Editorial board

Submit your article

Archive

Search

Journal of Economic Theory and Econometrics
JETEM/계량경제학보/計量經濟學報/JKES
Journal of the Korean Econometric Society

A New Approach to Social Welfare: tax-pension combination

Vol.30, No.3, September , 50–87


English Version |  Korean Version
  •   (Ajou University)

  •   (Seoul National University)

PDF
Abstract  

We view social welfare as a system that redistributes resources (i) within a generation and (ii) across generations so as to maximize social wellbeing. By setting tax and expenditure institutions properly, we implement optimal social welfare. Notable are the following implications: (i) in the presence of rising earnings inequality, redistribution within a generation is more important than that across generations. Fiscal policies in this line need to be stressed. (ii) Under low rates of population and economic growth, redistribution in the form of pensions loses its efficacy and therefore should not be encouraged for welfare reasons. This point has also been supported by pension reforms in many welfare states. Our preliminary calibration analysis confirms these conclusions numerically.


Keywords
   Social Welfare, Taxation, Pension

JEL classification codes
   H00, I31
Links

KCI list
Korean ES
JETEM at SCOPUS

Powered by MathJax