Cross-Dynastic Intergenerational Altruism

Arbeitspapier

I study whether saving behavior reveals socially relevant intertemporal preferences. To this end, I decompose the present generation's preference for the next into its dynastic and cross-dynastic components in a model of saving. If people are concerned about the next generation as such, then they might assign welfare weights on other dynasties. With such cross-dynastic intergenerational altruism, saving for one's descendants benefits present members of other dynasties. These preference externalities imply that socially relevant intertemporal preferences cannot be inferred from saving behavior. Numerically, I show that even \small" preferences for the next generation as such can lower the efficient discount rate by 20% to 40%, as compared to Nordhaus' calibration.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 9626

Classification and Topics

• Classification: Wirtschaft ; Altruism; Philanthropy; Intergenerational Transfers ; Social Choice; Clubs; Committees; Associations ; Project Evaluation; Social Discount Rate ; Sustainable Development ; Climate; Natural Disasters and Their Management; Global Warming
• Subject: intergenerational altruism ; social discounting ; time-inconsistency ; declining discount rates ; generalized consumption Euler equations ; interdependent utility ; isolation paradox

Contributors, Location and Time

• Event: Geistige Schöpfung
• (who): Nesje, Frikk
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2022

Further information

• Handle: http://hdl.handle.net/10419/252143
• Last update: 20.09.2024, 8:22 AM CEST