Munich Personal RePEc Archive

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.

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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.

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