Saving, Wealth and the Transition from Transfers to Individual Responsibility: The Cases of Taiwan and the United States

20 Pages Posted: 19 Oct 2003

See all articles by Ronald D. Lee

Ronald D. Lee

University of California, Berkeley - Department of Demography; National Bureau of Economic Research (NBER)

Andrew W. Mason

University of Hawaii at Manoa; East-West Center - Research Program

Timothy Miller

University of California, Berkeley - Department of Demography

Abstract

Under the life-cycle saving model, population aging leads to an increased demand for life-cycle wealth. Changes in transfer systems create or destroy one component of life-cycle wealth - transfer wealth. The decline in the familial transfer system in Taiwan and reform of the US Social Security system are two examples of ways that transfer wealth is reduced. The combined effects of aging and changes in transfer systems are analyzed using simulation analysis. Rapid aging and radical decline in transfer systems lead to a large but transitory surge in aggregate saving. Capital per worker increases rapidly and remains at a high level.

Suggested Citation

Lee, Ronald D. and Mason, Andrew W. and Miller, Timothy, Saving, Wealth and the Transition from Transfers to Individual Responsibility: The Cases of Taiwan and the United States. Available at SSRN: https://ssrn.com/abstract=443766

Ronald D. Lee (Contact Author)

University of California, Berkeley - Department of Demography ( email )

2232 Piedmont Avenue
Berkeley, CA 94720-2120
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Andrew W. Mason

University of Hawaii at Manoa ( email )

Honolulu, HI 96822
United States

East-West Center - Research Program ( email )

1601 East-West Road
Honolulu, HI 96848
United States

Timothy Miller

University of California, Berkeley - Department of Demography ( email )

2232 Piedmont Avenue
Berkeley, CA 94720-2120
United States

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