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Long-Term Fiscal Effects of Public Pension Reform in Norway – A Generational Accounting Analysis

Author

Listed:
  • Christian Hagist

    (Research Center for Generational Contracts, Freiburg University, Germany.)

  • Bernd Raffelhüschen

    (Research Center for Generational Contracts, Freiburg University, Germany.)

  • Alf Erling Risa

    (Department of Economics, University of Bergen, Norway.)

  • Erling Vårdal

    (Department of Economics, University of Bergen, Norway.)

Abstract

"Generational accounts" measure the fiscal sustainability of the public sector. We ask whether contributions from the Government Pension Fund and remaining oil and gas wealth in the ground, together with the pension reform taking effect in 2011, are sufficiently large to secure generational balance in Norway. Our results show that the pension reform has a substantial effect, and contributes as much to generational balance as the total petroleum wealth. Structural characteristics of higher employment and lower transfer payments typical for cyclical upturns improve the GAs substantially. Optimistic assumptions regarding these structural characteristics do not remove the need for further reforms to obtain fiscal sustainability of the Norwegian public sector.

Suggested Citation

  • Christian Hagist & Bernd Raffelhüschen & Alf Erling Risa & Erling Vårdal, 2013. "Long-Term Fiscal Effects of Public Pension Reform in Norway – A Generational Accounting Analysis," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 38, pages 1-2.
    • Handle: RePEc:noj:journl:v:37:y:2013:p:2
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    References listed on IDEAS

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    1. Ulrich Benz & Stefan Fetzer, 2006. "Indicators for Measuring Fiscal Sustainability: A Comparison of the OECD Method and Generational Accounting," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 62(3), pages 367-391, September.
    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.
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    1. Public pensions are not sustainable, even in Norway
      by Economic Logician in Economic Logic on 2011-07-19 19:58:00

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    More about this item

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • H68 - Public Economics - - National Budget, Deficit, and Debt - - - Forecasts of Budgets, Deficits, and Debt
    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General

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