JOURNAL ARTICLE

INCOME-DEPENDENT PARENTAL ALTRUISM AND PERSISTENT INCOME INEQUALITY IN A DEVELOPING ECONOMY.

  • Published In: Singapore Economic Review, 2025, v. 70, n. 6. P. 1565 1 of 3

  • Database: Business Source Ultimate 2 of 3

  • Authored By: YIN, XIANGYUN; NAKAMURA, TAMOTSU 3 of 3

Abstract

In this paper, we consider an overlapping-generations economy in which human capital is the engine of economic growth. Human capital accumulates through parents' investments in their children based on warm-glow altruism. Assuming that parental altruism depends on parental income, we introduce a utility function into a simple model to explain the relationship between parental income and education expenditure. Consequently, various dynamics of household human capital accumulation emerge, which in turn yield a variety of income inequalities. This highlights the importance of income-dependent parental altruism in determining income inequality not only in the transition but also in the steady state. It is also shown that income inequality may persist in the long run. [ABSTRACT FROM AUTHOR]

Additional Information

  • Source:Singapore Economic Review. 2025/09, Vol. 70, Issue 6, p1565
  • Document Type:Article
  • Subject Area:Economics
  • Publication Date:2025
  • ISSN:0217-5908
  • DOI:10.1142/S0217590824500462
  • Accession Number:188319394
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