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Is the deficit under control? A generational accounting perspective on fiscal policy and labour market trends in Spain

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According to the 2001 Spanish budgetary figures, the government deficit is about to disappear. Within a generational accounting framework we analyse if current fiscal policy is also intertemporally balanced. Furthermore, we extend the standard methodology incorporating tax and transfer age profiles by employment status in order to analyse the intertemporal impact of several future employment developments. First, the effect of the reduction in unemployment is disentangled from the effect of fiscal policy reforms during the period 1996-2000. Second, we assess the fiscal effects of an expected future increase in female labour force participation. Finally, we evaluate the impact of a decline in unemployment to the natural rate of unemployment

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  • Gemma Abío & Eduard Berenguer & Holger Bonin & Joan Gil & Concepció Patxot, 2003. "Is the deficit under control? A generational accounting perspective on fiscal policy and labour market trends in Spain," Investigaciones Economicas, Fundación SEPI, vol. 27(2), pages 309-341, May.
  • Handle: RePEc:iec:inveco:v:27:y:2003:i:2:p:309-341
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    1. Holger Bonin & Joan Gil & Concepció Patxot, 2001. "Beyond the Toledo agreement: the intergenerational impact of the Spanish Pension Reform," Spanish Economic Review, Springer;Spanish Economic Association, vol. 3(2), pages 111-130.
    2. Alan J. Auerbach & Jagadeesh Gokhale & Laurence J. Kotlikoff, 1991. "Generational Accounts: A Meaningful Alternative to Deficit Accounting," NBER Chapters,in: Tax Policy and the Economy, Volume 5, pages 55-110 National Bureau of Economic Research, Inc.
    3. Auerbach, Alan J & Gokhale, Jagadeesh & Kotlikoff, Laurence J, 1992. " Generational Accounting: A New Approach to Understanding the Effects of Fiscal Policy on Saving," Scandinavian Journal of Economics, Wiley Blackwell, vol. 94(2), pages 303-318.
    4. Buiter, Willem H, 1997. "Generational Accounts, Aggregate Saving and Intergenerational Distribution," Economica, London School of Economics and Political Science, vol. 64(256), pages 605-626, November.
    5. Auerbach, Alan J., 1997. "Quantifying the Current U.S. Fiscal Imbalance," National Tax Journal, National Tax Association;National Tax Journal, vol. 50(3), pages 387-398, September.
    6. Robert Haveman, 1994. "Should Generational Accounts Replace Public Budgets and Deficits?," Journal of Economic Perspectives, American Economic Association, vol. 8(1), pages 95-111, Winter.
    7. Raffelhuschen, B., 1999. "Generational Accounting in Europe," Norway; Department of Economics, University of Bergen 196, Department of Economics, University of Bergen.
    8. Alan J. Auerbach & Laurence J. Kotlikoff & Willi Leibfritz, 1999. "Generational Accounting around the World," NBER Books, National Bureau of Economic Research, Inc, number auer99-1, June.
    9. Holger Bonin & Bernd Raffelhüschen & Jan Walliser, 2000. "Can Immigration Alleviate the Demographic Burden?," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 57(1), pages 1-1, September.
    10. Alan J. Auerbach & Laurence J. Kotlikoff & Willi Leibfritz, 1999. "Introduction to "Generational Accounting around the World"," NBER Chapters,in: Generational Accounting around the World, pages 1-8 National Bureau of Economic Research, Inc.
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    Cited by:

    1. Concepció Patxot & Elisenda Renteria & Miguel Sanchez-Romero & Guadalupe Souto, 2011. "How intergenerational transfers finance the lifecycle deficit in Spain," Chapters,in: Population Aging and the Generational Economy, chapter 10 Edward Elgar Publishing.
    2. International Monetary Fund, 2005. "Spain; Selected Issues," IMF Staff Country Reports 05/57, International Monetary Fund.
    3. Concepció Patxot & Elisenda Rentería & Miguel Romero & Guadalupe Souto, 2012. "Measuring the balance of government intervention on forward and backward family transfers using NTA estimates: the modified Lee arrows," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 19(3), pages 442-461, June.
    4. Holger Bonin & Concepció Patxot & Guadalupe Souto, 2014. "Cyclically‐Neutral Generational Accounting," Fiscal Studies, Institute for Fiscal Studies, vol. 35, pages 117-137, June.
    5. Gemma Abio Roig & Joan Gil Trasfi & Concepcion Patxot Cardoner, 2005. "La Ley de Estabilidad Presupuestaria en el largo plazo: efecto del ciclo demografico," Working Papers in Economics 126, Universitat de Barcelona. Espai de Recerca en Economia.

    More about this item

    Keywords

    Generational accounting; fiscal policy in Spain; public debt; demographic ageing;

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions

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