Fiscal Sustainability and Demographics - Should We Save or Work More?
Approaching demographic shifts are raising concerns about fiscal sustainability in most OECD countries. A widespread view based on the tax-smoothing idea is that a prior consolidation of public finances is required to cope with the predicted trend deterioration in the primary budget balance. Both positive aspects in assessing the order of magnitude of sustainability problems and normative aspects of formulating policy strategies are addressed. It is argued that the smoothing argument cannot unconditionally be applied to the demographic problem. It is important to distinguish between increases in the dependency ratio driven by changes in fertility and longevity. For the former the smoothing argument may be appropriate, but not for the latter. In the case of longevity, a trade-off between consolidation and increasing retirement ages becomes relevant, and there are strong arguments why the latter should be pursued by e.g. linking retirement ages to longevity.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
|Date of creation:||Nov 2008|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: 44 - 20 - 7183 8801
Fax: 44 - 20 - 7183 8820
|Order Information:|| Email: |
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- de la Croix, David & Mahieu, Géraldine & Rillaers, Alexandra, 2000.
"How should retirement policy adjust to the baby bust ?,"
Discussion Papers (IRES - Institut de Recherches Economiques et Sociales)
2001003, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
- David De La Croix & Géraldine Mahieu & Alexandra Rillaers, 2004. "How Should the Allocation of Resources Adjust to the Baby Bust?," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 6(4), pages 607-636, October.
- Alexandra Rillaers & David de la Croix & Geraldine Mahieu, 2003. "How Should The Allocation Of Resources Adjust To The Baby Bust?," Working Papers. Serie AD 2003-27, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
- Boris Cournède & Frédéric Gonand, 2006.
"Restoring Fiscal Sustainability in the Euro Area: Raise Taxes or Curb Spending?,"
OECD Economics Department Working Papers
520, OECD Publishing.
- Cournède, Boris & Gonand, Frédéric, 2006. "Restoring Fiscal Sustainability in the Euro Area Raise Taxes or Curb Spending?," Economics Papers from University Paris Dauphine 123456789/11047, Paris Dauphine University.
- Barro, Robert J., 1979.
"On the Determination of the Public Debt,"
3451400, Harvard University Department of Economics.
- Martin FlodÈn, 2003.
"Public Saving and Policy Coordination in Aging Economies,"
Scandinavian Journal of Economics,
Wiley Blackwell, vol. 105(3), pages 379-400, 09.
- Flodén, Martin, 2002. "Public Saving and Policy Coordination in Ageing Economies," CEPR Discussion Papers 3567, C.E.P.R. Discussion Papers.
- Oecd, 2006. "Projecting OECD Health and Long-Term Care Expenditures: What Are the Main Drivers?," OECD Economics Department Working Papers 477, OECD Publishing.
- Andersen, Torben M., 2008. "Increasing longevity and social security reforms--A legislative procedure approach," Journal of Public Economics, Elsevier, vol. 92(3-4), pages 633-646, April.
- Mulligan Casey B & Sala-i-Martin Xavier, 2004. "Political and Economic Forces Sustaining Social Security," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 4(1), pages 1-56, May.
- Padilla, Emilio, 2002. "Intergenerational equity and sustainability," Ecological Economics, Elsevier, vol. 41(1), pages 69-83, April.
- Galasso, Vincenzo & Profeta, Paola, 2002. "The political economy of social security: a survey," European Journal of Political Economy, Elsevier, vol. 18(1), pages 1-29, March.
- Daniel Leigh & David Hauner & Michael Skaarup, 2007. "Ensuring Fiscal Sustainability in G-7 Countries," IMF Working Papers 07/187, International Monetary Fund.
When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:7044. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.