Endogenous fertility, Ricardian equivalence, and debt management policy.
This paper develops a model in which dynastic families optimally determine fertility.  Government debt represents a tax on future generations and on childbearing; the Ricardian Equivalence Hypothesis does not hold.  Debt is welfare reducing in that it distorts the fertility decision.  An increase in government debt induces a decline in fertility and an increase in the steady state capital/labor ratio.  If a government inherits an existing stock of debt, the 1st-best policy is to eliminate the debt immediately.  In other situations the optimal debt management policy will not, in general, entail a total elimination of the debt.
Lapan
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Enders
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D003710:Demography; D004467:Economics; D004651:Employment; D005298:Fertility; D005376:Financial Management; D005380:Financing, Government; D006076:Government; D006280:Health Workforce; D011057:Politics; D011153:Population; D011157:Population Dynamics; D011640:Public Policy
Capital; Demographic Factors; Economic Conditions; Economic Factors; Fertility; Financial Activities; Financing, Government; Government; Human Resources; Labor Force; Macroeconomic Factors; Policy; Political Factors; Population; Population Dynamics