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Dynasties and Destiny: On the Roles of Altruism and Impatience in the Evolution of Consumption and Bequests

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  • Ita Falk
  • Oded Stark
Abstract
We study the joint role of altruism and impatience, and the impact of evolution in the formation of long–term time preferences and in the determination of optimal consumption and optimal bequests. We show how the consumption paths of dynasties relate to altruism and to impatience, and we reason that long–lived dynasties will be characterized by a higher degree of altruism and a lower degree of impatience than short–lived dynasties.

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  • Ita Falk & Oded Stark, 2001. "Dynasties and Destiny: On the Roles of Altruism and Impatience in the Evolution of Consumption and Bequests," Economica, London School of Economics and Political Science, vol. 68(272), pages 505-518, November.
    • Handle: RePEc:bla:econom:v:68:y:2001:i:272:p:505-518
    DOI: 10.1111/1468-0335.00259
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    1. Barro, Robert J, 1974. "Are Government Bonds Net Wealth?," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1095-1117, Nov.-Dec..
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    5. Dasgupta, Partha, 1974. "On some alternative criteria for justice between generations," Journal of Public Economics, Elsevier, vol. 3(4), pages 405-423, November.
    6. Robert A. Becker, 1980. "On the Long-Run Steady State in a Simple Dynamic Model of Equilibrium with Heterogeneous Households," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 95(2), pages 375-382.
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    Cited by:

    1. Oded Stark & Anna Nicinska, 2015. "How Inheriting Affects Bequest Plans," Economica, London School of Economics and Political Science, vol. 82, pages 1126-1152, December.
    2. Oded Stark & Doris Behrens & Yong Wang, 2009. "On the evolutionary edge of migration as an assortative mating device," Journal of Evolutionary Economics, Springer, vol. 19(1), pages 95-109, February.
    3. MICHEL, Philippe & PESTIEAU, Pierre, 2002. "Fiscal policy with agents differing in altruism and in ability," LIDAM Discussion Papers CORE 2002049, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    4. Rong, Rong & Gnagey, Matthew & Grijalva, Therese, 2018. "“The less you Discount, the more it shows you really care”: Interpersonal discounting in households," Journal of Economic Behavior & Organization, Elsevier, vol. 154(C), pages 1-23.
    5. Savvateev, Alexei & Stark, Oded, 2005. "An evolutionary explanation for the propensity to migrate," EconStor Preprints 279746, ZBW - Leibniz Information Centre for Economics.
    6. Michel, Philippe & Thibault, Emmanuel & Vidal, Jean-Pierre, 2006. "Intergenerational altruism and neoclassical growth models," Handbook on the Economics of Giving, Reciprocity and Altruism, in: S. Kolm & Jean Mercier Ythier (ed.), Handbook of the Economics of Giving, Altruism and Reciprocity, edition 1, volume 1, chapter 15, pages 1055-1106, Elsevier.
    7. Oded Stark & Yong Wang, 2005. "The Intergenerational Overlap and Human Capital Formation," Review of International Economics, Wiley Blackwell, vol. 13(1), pages 45-58, February.
    8. Breuer, Wolfgang & Müller, Torbjörn & Sachsenhausen, Eric, 2022. "The determinants of discounting in intergenerational decision-making," European Economic Review, Elsevier, vol. 148(C).
    9. Rong Rong & Therese C. Grijalva & Jayson Lusk & W. Douglass Shaw, 2019. "Interpersonal discounting," Journal of Risk and Uncertainty, Springer, vol. 58(1), pages 17-42, February.
    10. Werner Güth & Kurt-Dieter Koschmieder & M. Vittoria Levati & Ev Martin, 2005. "How to Preserve a Fortune: An Experimental Comparison of Foundations and Direct Transfers to the Heir," Papers on Strategic Interaction 2005-33, Max Planck Institute of Economics, Strategic Interaction Group.
    11. Agarwal, Bina, 2009. "Rule making in community forestry institutions: The difference women make," Ecological Economics, Elsevier, vol. 68(8-9), pages 2296-2308, June.
    12. Mariko J. Klasing & Petros Milionis, 2014. "Cultural Constraints On Innovation-Based Growth," Economic Inquiry, Western Economic Association International, vol. 52(2), pages 796-810, April.

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    More about this item

    JEL classification:

    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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