Brumm Lab

Research focus

ERC Starting Grant · 2021

The Old, the Young, and the Uncertain Future: Using High-Dimensional Stochastic Overlapping-Generations Models to Evaluate Fiscal Policies that Shift Risk and Resources Across Generations

Policy decisions about government borrowing, taxation, and spending have a differential impact on generations and thus imply substantial intergenerational transfers. The costs and benefits of these policies occur over decades and come with large uncertainty, for instance related to productivity growth, global financial conditions, and demographic trends. Therefore, fiscal policies, whether intentional or not, transfer risk and resources across generations. Assessing their impact on welfare calls for simulating such policies in models that include the relevant demographics and risks, yet also the related risk-premia. The latter lower government borrowing costs relative to the expected return…

From the public funding record at EU CORDIS. Describes the funded project, not the reviews below.