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Joachim Thøgersen
''A note on social security, human capital and growth''
( 2019, Vol. 39 No.4 )
In this paper we study the effect of an old-age public pension scheme, when growth is triggered by human capital accumulation. In Zhang (1995) and Kemnitz and Wigger (2000), it is shown that introducing an unfunded pension system in a Laissez-Faire economy will increase economic growth. The present paper follows Kemnitz and Wigger, but shows that a properly designed public funded system will also generate higher economic growth than a Laissez-Faire economy. Moreover, it is shown how capital intensity is affected by the funded pension scheme.
Keywords: Human and physical capital accumulation, public pensions, overlapping generations, endogenous growth
JEL: H5 - National Government Expenditures and Related Policies National Government Expenditures and Related Policies: General
D9 - Intertemporal Choice and Growth: General
Manuscript Received : Mar 04 2019 Manuscript Accepted : Dec 18 2019

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