Intergenerational geometric transfers of income

TL;DR

This paper introduces a family of geometric rules for modeling intergenerational income transfers, grounded in axioms like consistency and scale invariance, to analyze income distribution across infinite generations.

Contribution

It formalizes a new class of transfer rules based on axiomatic principles, extending the analysis of intergenerational income distribution.

Findings

Identifies a family of geometric transfer rules

Establishes axiomatic foundations for transfer rules

Provides a framework for analyzing infinite income streams

Abstract

We study intergenerational transfers of income. In our stylized model, each generation in an infinite (but countable) stream is endowed with some income. An allocation rule associates with each infinite stream another stream, thus involving intergenerational transfers of income. We single out a family of geometric rules as a consequence of imposing axioms formalizing the principles of consistency, continuity and independence (as well as the basic requirements of feasibility and scale invariance).