LAUSR

Some reports of the related literature describe examinations of whether a child allowance and the subsidy for education investment can raise fertility and education investment, or not. This paper presents consideration of the pension incentive policy as substitutive policies of a child allowance and a subsidy for education investment in a model of quality and quantity of children. Results of the study reported herein demonstrate that pension incentive policy cannot always increase fertility and the education investment, i.e., the growth rate of the human capital stock. If the pension incentive policy can raise fertility and the growth rate of the human capital stock, then the pension incentive policy plays the roles of a child allowance and a subsidy for the education investment. Otherwise, the pension incentive policy should not be provided in place of the child allowance and the subsidy for education investment. Pension incentive policy effects on fertility and the growth rate of the human capital stock depend on the preference parameters of quality and the quality of children.