Scholarship Policy for Foreign Immigrants: A Dynamic Analysis
Date Issued
2014
Date
2014
Author(s)
Kheng, Zoe Tan Chee
Abstract
Pay-As-You-Go (PAYG) social security system operates in such a way that the social security fund is depending on the numbers and income of the current workers. This leads to a situation where a continuously increasing tax rate is required to sustain the social security system. As suggested in the literature, allowing immigration actually increasing more population to taxed on, and further lightens the tax burden on the local working generation. In our model, we incorporate a scholarship policy into the government budget constraint which serves as international migration attraction factor, and further evaluate the performance of the policy in the economy with PAYG social security system. First, we develop an overlapping generation model with a PAYG social security scheme as a benchmark. Second, we introduce immigration with scholarship as attraction factor into the benchmark model. The comparison of before and after scholarship policy is implemented in a simulated economy with PAYG social security system shows that the economy with PAYG social security system is benefited from the scholarship policy with a relatively small cost on the capital accumulation. Besides that, the numerical results suggest that immigrants-friendly policy such as allowing more immigrants and higher scholarship amount for immigrants have a positive effect on the capital accumulation.
Subjects
隨收隨付年金制
疊代模型
獎學金政策
外來移民人口
稅基
SDGs
Type
thesis
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ntu-103-R00323054-1.pdf
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