2026/07/26 by Toshiki Tamai
Business, Management and Accounting · Economics, Econometrics and Finance · #Economic Growth and Productivity #Economic Policies and Impacts #Financial Literacy, Pension, Retirement Analysis
paper · doi:10.1111/meca.70027
crossref issued 2026/07/26 · crossref published 2026/07/26 · crossref published-online 2026/07/26 · openalex publication_date 2026/07/26 · crossref created 2026/07/26 · crossref deposited 2026/07/26 · crossref indexed 2026/07/26 · openalex created_date 2026/07/27 · openalex updated_date 2026/07/28
ABSTRACT This paper examines the effects of the social security fund on long‐run economic growth and welfare in an overlapping generations economy with incomplete capital markets and idiosyncratic productivity shocks. The presence of a social security fund reserve affects capital accumulation by partly offsetting the crowding‐out effect of social security through public investment. Under incomplete capital markets, social security improves welfare by providing social insurance against idiosyncratic risks. We show that these growth and insurance effects of social security jointly improve welfare for all generations if the initial labor income share is sufficiently large.