The destabilizing effects of the social norm to work under a social security system

Rodolphe dos Santos Ferreira; Teresa Lloyd-Braga; Leonor Modesto

doi:10.1016/j.mathsocsci.2015.04.004

The destabilizing effects of the social norm to work under a social security system

Rodolphe dos Santos Ferreira
, Teresa Lloyd-Braga^*
, Leonor Modesto

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

1 Citation (Scopus)

Abstract

We study employment dynamics in an OLG model with unemployment benefits financed by taxing wages, and with a defined contribution plan. The novelty with respect to recent studies of the effects of social security in this context is that we introduce a social norm to work, shaping the worker's participation decision, and hence affecting the reservation wage. We find that a strong social norm to work destabilizes conventional wisdom by reversing the negative effects of social security on employment, and destabilizes the economy by facilitating the emergence of endogenous fluctuations.

Original language	English
Pages (from-to)	64-72
Number of pages	9
Journal	Mathematical Social Sciences
Volume	76
DOIs	https://doi.org/10.1016/j.mathsocsci.2015.04.004
Publication status	Published - 1 Jul 2015

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This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 1 No Poverty
SDG 16 Peace, Justice and Strong Institutions

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10.1016/j.mathsocsci.2015.04.004

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title = "The destabilizing effects of the social norm to work under a social security system",

abstract = "We study employment dynamics in an OLG model with unemployment benefits financed by taxing wages, and with a defined contribution plan. The novelty with respect to recent studies of the effects of social security in this context is that we introduce a social norm to work, shaping the worker's participation decision, and hence affecting the reservation wage. We find that a strong social norm to work destabilizes conventional wisdom by reversing the negative effects of social security on employment, and destabilizes the economy by facilitating the emergence of endogenous fluctuations.",

author = "Ferreira, \{Rodolphe dos Santos\} and Teresa Lloyd-Braga and Leonor Modesto",

note = "Funding Information: Financial support from FCT under the PTDC/EGE-ECO/103468/2008 is gratefully acknowledged. We thank participants of annual conferences SAET 2013, held at MINES ParisTech, and PET 2013, held in Cat{\'o}lica Lisbon, for useful comments. We also thank two referees for precious suggestions. Publisher Copyright: {\textcopyright} 2015.",

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AU - Ferreira, Rodolphe dos Santos

AU - Lloyd-Braga, Teresa

AU - Modesto, Leonor

N1 - Funding Information: Financial support from FCT under the PTDC/EGE-ECO/103468/2008 is gratefully acknowledged. We thank participants of annual conferences SAET 2013, held at MINES ParisTech, and PET 2013, held in Católica Lisbon, for useful comments. We also thank two referees for precious suggestions. Publisher Copyright: © 2015.

PY - 2015/7/1

Y1 - 2015/7/1

N2 - We study employment dynamics in an OLG model with unemployment benefits financed by taxing wages, and with a defined contribution plan. The novelty with respect to recent studies of the effects of social security in this context is that we introduce a social norm to work, shaping the worker's participation decision, and hence affecting the reservation wage. We find that a strong social norm to work destabilizes conventional wisdom by reversing the negative effects of social security on employment, and destabilizes the economy by facilitating the emergence of endogenous fluctuations.

AB - We study employment dynamics in an OLG model with unemployment benefits financed by taxing wages, and with a defined contribution plan. The novelty with respect to recent studies of the effects of social security in this context is that we introduce a social norm to work, shaping the worker's participation decision, and hence affecting the reservation wage. We find that a strong social norm to work destabilizes conventional wisdom by reversing the negative effects of social security on employment, and destabilizes the economy by facilitating the emergence of endogenous fluctuations.

UR - https://www.scopus.com/pages/publications/84929191611

U2 - 10.1016/j.mathsocsci.2015.04.004

DO - 10.1016/j.mathsocsci.2015.04.004

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AN - SCOPUS:84929191611

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VL - 76

SP - 64

EP - 72

JO - Mathematical Social Sciences

JF - Mathematical Social Sciences

ER -

The destabilizing effects of the social norm to work under a social security system

Abstract

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