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Policy Reforms and Growth in Computable OLG Economies

Author

Listed:
  • Bouzahzah, Mohamed

    (University of Lille 2, CADRE)

  • de la Croix, David

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) ; Belgian National Fund for Scientific Research (FNRS); UCLA)

  • Docquier, Frédéric

    (Ministère de la Région wallonne, SES, Belgium)

Abstract

We build a computable general equilibrium model with overlapping generations of agents and an endogenous growth specification à la Lucas. Two main issues are addressed: (i) to what extent does endogenous growth play a significant role in the face of policy reform and (ii) are the simulation results robust to various calibrations of the production function of human capital. In this purpose, we simulate four large policy changes and compare the predictions with endogenous growth (under various parameter sets) to those with exogenous growth. If endogenous growth is important when examining the effects of education reform, it does not really matter with pension reforms and plays a minor role in the debt repayment scenario. These results are very robust to calibration.

Suggested Citation

  • Bouzahzah, Mohamed & de la Croix, David & Docquier, Frédéric, 2000. "Policy Reforms and Growth in Computable OLG Economies," LIDAM Discussion Papers IRES 2000027, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    • Handle: RePEc:ctl:louvir:2000027
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    References listed on IDEAS

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