This paper reconsiders the role of altruism as a motive for an intergenerational transfer and characterizes the relationship between intergenerational transfers and altruism. The main finding is that transfers to children do not disappear even if altruism from parents to children weakens. The paper also shows that as altruism from children to parents becomes stronger, a transfer to children initially decreases and then increases once the degree of altruism is beyond a certain level; in other words, transfers may increase even if altruism from the transferee to the transferor becomes stronger. These findings sharply contrast with the common assumption in the existing literature that an intergenerational transfer is motivated by altruism from the transferor to the transferee.

This study investigates the role of altruism as a motive for transfer payments. In the existing literature on altruism, it is generally assumed that a transfer payment is made out of altruism that a transferor feels towards a transferee. This study demonstrates that this is not necessarily the case. By using a dynamic model in which children are altruistic towards parents, it demonstrates that such altruism may induce a parent to give a transfer to children.

Few studies analyze the endogenous emergence of price competition in a new product market. This paper analyzes two differentiated products, an existing product and a newly introduced substitutable product, and investigates conditions under which a price competition endogenously emerges in a new product market in the context of a choice between engaging in price competition and holding price leadership. We demonstrate that Bertrand price competition emerges when the setup cost for the new product is high enough. This result implies that government policies reducing setup costs such as subsidies could change the type of competition to price leadership in a new product market.

This study demonstrates that business cycles with complex periodic fluctuations may arise in an overlapping generations model with two-sided altruism. The structure of an equilibrium dynamical system strongly depends on the degree of altruism in the model. If either altruism of a generation to the parent or the child disappears, the study also demonstrates that complex periodic fluctuations never occur. In this sense, two-sided altruism is essential for a complex business cycle.