Intergenerational Governance and Leadership Around the World

Intergenerational Governance and Leadership Around the World

Julia Margarete Puaschunder (Columbia University, USA & Princeton University, USA & The New School, USA)
DOI: 10.4018/978-1-5225-8003-4.ch008

Abstract

In the eye of current intergenerational concerns, the study of global intergenerational balances leverages into a necessary and blatant demand but is up-to-date limited. Intertemporal transfers between generations have not been captured on a global scale. Pursuing to fill laissez-faire gaps on intergenerational concerns, outlining public or private sector endeavors in coordinating intergenerational exchange would provide concrete means how to balance intertemporal benefits and burdens between overlapping generations in a fair way. In the contemporary extensive writing on inequality, unraveling intergenerational equity opens ways to steer intertemporal social mobility. Therefore, the creation of a contemporary macroeconomic intergenerational transfer model with attention to public and private sector contributions as well as benefit and burden sharing are proposed and preliminary results presented.
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Theory

The proposed novel model is targeted at extending on classical optimal growth theories (Solow, 1956; Swan, 1964) featuring a traditional focus on capital and labor as well as advance intertemporal optimization growth models (Cass & Yaari, 1967; Koopmans, 1965; Phelps, 1961, 1966; Samuelson, 1975 a, b; Shell, 1967; Tobin, 1967; von Weizsäcker, 1962) based on Ramsey’s (1928) intertemporal optimization idea. Traditional intertemporal discount rates and weighting functions are replaced with a more dynamic and humanistic approach to capture intergenerational transfers paying attention to the need of subjective time discounting and social conscientiousness (Puaschunder, 2016a, b). Building on behavioral decision sciences and humane natural ‘principles of personal good’ (Broome, 1991; Laibson, 1997); behavioral economics insights on intergenerational equity find social responsibility and future orientation as prerequisites of intergenerationally-conscientious decision making (Wade-Benzoni & Tost, 2009; Puaschunder, 2016c; Puaschunder & Schwarz, 2012).

Intergenerational Equity has been studied primarily by behavioral economists and social psychologists (Puaschunder, 2017a). However, since 2008 the International Law Commission of the United Nations has been promoting intergenerational equity primarily on global governance issues – such as climate change awareness, overindebtedness and pension reform – to the public sector (Puaschunder, 2015); yet to this day there exists no stringent framework on intergenerational transfers in the public and private sectors. The implementation of intergenerational equity in this domain, though, seems to be slowed by an ongoing discussion of whether international law can overrule nation states’ sovereignty. The debate has just recently started and may not come to a satisfactory end in the foreseeable future.

In a macro-economic attempt to capture intergenerational transfers, the following research question sets out to become the first intergenerational equity balancing measurement tool.

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