An OLG model of growth with longevity: when grandparents take care of grandchildren

Fanti, Luciano and Gori, Luca (2011): An OLG model of growth with longevity: when grandparents take care of grandchildren.

Abstract

By assuming that grandparents take care of grandchildren, in this paper we aim at studying the effects of longevity on economic growth in the basic OLG model with endogenous fertility. We show that a rise in longevity can actually reduce long-run growth. Moreover, we also find that an increasing longevity (i) increases the supply of labour by the young parents, and (ii) causes fertility either to increase of decrease depending on the size of the grandparental child rearing time.

• Item Type: MPRA Paper
• Language: English
• Keywords: Longevity; OLG model
• Subjects: J - Labor and Demographic Economics > J1 - Demographic Economics > J13 - Fertility ; Family Planning ; Child Care ; Children ; Youth; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O41 - One, Two, and Multisector Growth Models; J - Labor and Demographic Economics > J2 - Demand and Supply of Labor > J22 - Time Allocation and Labor Supply

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