LOOKING AT THE “POPULATION PROBLEM” THROUGH THE PRISM OF HETEROGENEITY: WELFARE AND POLICY ANALYSES* |
| |
| Authors: | C. Simon Fan Oded Stark |
| |
| Affiliation: | 1. Lingnan University, Hong Kong;2. University of Klagenfurt, Austria, University of Bonn, Germany, University of Vienna, Austria, University of Warsaw, Poland, and Warsaw School of Economics, Poland;3. We are indebted to Charles Yuji Horioka for his guidance, to three anonymous referees for valuable advice and numerous constructive suggestions, and to Katarzyna Saczuk for helpful comments. Please address correspondence to: Oded Stark, ZEF, University of Bonn, Walter‐Flex‐Strasse 3, D‐53113 Bonn, Germany. E‐mail: . |
| |
| Abstract: | Upon introducing heterogeneity and dynamics into a model of the demand for children, a problem of optimal population is defined and analyzed. It is shown that from the perspective of social welfare, better‐educated individuals produce too few children while less‐educated individuals produce too many children and all individuals invest too little in the education of their children. The impact of several policy tools geared at addressing the “population problem” is investigated, in particular how child allowances and other tax‐subsidy policies can be harnessed to enhance welfare, and how and why early childhood education programs can mitigate the “population problem.” |
| |
| Keywords: | |
|
|
