Job Market Paper

• The Intergenerational Welfare Cost of Social Security Insolvency
  Abstract · pdf

  This paper asks which generations bear the welfare cost of Social Security insolvency. I fix Social Security reserve depletion at the end of 2033, but each generation meets the same event at a different age, with different years of payments at stake and different means of adjusting. In a life-cycle model with endogenous saving, labor supply, human capital, and claiming, I quantify how the expected duration of reduced payments shifts that welfare incidence. The main result is that the cohort losing the most unpaid dollars is not the cohort losing the most welfare. Households that expect the shortfall self-insure by saving, working, and human-capital investment, but the cost of doing so depends on age. The youngest cohorts spread the adjustment over a career, whereas mid-career cohorts must compress it into the years before retirement and end up worse off than if the shortfall had been a surprise. Duration matters as well. When the shortfall is brief, the burden lands mainly on cohorts at or near claiming; when it is prolonged, the burden shifts toward the working generations behind them.

Working Paper

• Generosity, Legibility, and Fertility Inertia
  Abstract · pdf

  Large family-policy budgets have often produced surprisingly small changes in fertility. The programs that do move births tend to share a different feature: households can tell what they will receive and for how long. I study this distinction in a dynastic fertility model in which parents see public news and policy announcements but are unsure how closely either maps into their own future. A cautious parent evaluates each family plan using the least favorable interpretation she cannot rule out. This behavior creates fertility inertia: moderately adverse news reduces welfare without changing fertility, investment per child, or consumption. It also makes the perceived value of a transfer depend on its worst-case household-level pass-through rather than on the government's expenditure. An opaque program must therefore promise more than a transparent entitlement to generate the same fertility response. The analysis suggests that family policy has two distinct margins, generosity and legibility, and that increasing the first without improving the second can make fertility less responsive to subsequent news.

Work in Progress

• Optimal Immigration Policy under Private Information