This paper examines the impact of a change in the German child benefit system in 1996, which led to a large increase in lump sum transfers to families with children. We analyze the impact on the labor force participation of family members as well as on household consumption directed to children. Comparing behavioral changes of adults with children with behavioral changes of adults without child...

In the United States, more than two-thirds of decedents with multichild families divide their estates exactly equally among their children. In contrast, intra vivos gifts are usually unequal. These findings challenge the validity of existing theories regarding the determination of intergenerational transfers. In this paper, we develop a theory that accounts for this puzzle, based on the notion ...

Female Labour Supply, Human Capital and Welfare Reform We consider the impact of tax credits and income support programs on female education choice, employment, hours and human capital accumulation over the life-cycle. We analyze both the short run incentive effects and the longer run implications of such programs. By allowing for risk aversion and savings, we quantify the insurance value of al...

We review theoretical explanations for in-kind transfers in light of the limited empirical evidence. After reviewing the traditional paternalistic arguments, we consider explanations based on imperfect information and self-targeting. We then discuss the large literature on in-kind programs as a way of improving the efficiency of the tax system and a range of other possible explanations includin...

This paper exploits a natural policy experiment to directly identify the crowding out effects of public transfers on the incidence and level of private transfers. The introduction of a large social security program in Taiwan is used to estimate the effect of an exogenous increase in government transfer payments to the elderly on the private transfer behavior of their adult children. Using an in...

This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate. The present paper reviews key issues in pension design and pe...

Wealth inequality is currently rising in rich countries. Expectations that ever more intelligent machines might replace people’s jobs amplify the concerns about an increasingly unequal wealth distribution. We examine how capital tax-financed public investment affects the distribution of wealth when the substitutability between capital and labor changes. We consider a setting with a labor-augmen...

This paper extends the standard model of life cycle consumption, saving and labor supply in a number of directions. First, it argues that consumption should be defined as expenditure on household production as well as on market goods, that is, we are interested in life cycle profiles of full consumption. If this is done, several well-known puzzles concerning life cycle consumption behaviour are...

We study optimal taxation in the general extensive model: the only decision of the participants in the economy is to choose between working (full time) or staying inactive. People differ in their productivities and in other features which determine their work opportunity costs. We characterize the optimal tax schemes when the distribution of work opportunity costs is independent of productivity...

METHODS. The infants were divided into groups of colonized infants of allergic mothers (56), control infants of allergic mothers (57), and control infants of healthy mothers (45). Infants of allergic mothers were randomly assigned to 1 of the first 2 groups. Incidence rates of bacterial pathogens in stool and levels of anti–E coli immunoglobulins and serum cytokines were determined, and secreto...