Societal Aging: Implications for Fiscal Policy
This paper considers implications of population aging for the conduct of fiscal policy, grouping the issues into four areas, focusing on the impact of aging on: (1) the size of government budget imbalances; (2) the composition of government spending and government budget flexibility; (3) the composition of tax collections and the desirability of alternative tax systems; and (4) the effectiveness of fiscal policy as a tool for stabilization. Societal aging puts considerable stress put on public sector finances because of large, unfunded and age-based entitlement programs. Even if existing programs can be modified, a growing share of government budgets will be devoted to old-age entitlement programs, and both economics and politics suggest that this will reduce the flexibility of budget determinations. An aging population makes certain tax bases - in particular, consumption taxes, and wealth transfer taxes as well - more productive and efficient. The consequences of aging are less clear as to stabilization policy, both with respect to the effectiveness of automatic stabilizers and the ability of government to take effective discretionary actions.
|Date of creation:||Sep 2012|
|Contact details of provider:|| Postal: 2-1-1 Nihonbashi, Hongoku-cho, Chuo-ku, Tokyo 103|
Web page: http://www.imes.boj.or.jp/
More information through EDIRC
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.:
- Cooley, Thomas F. & Soares, Jorge, 1996.
"Will social security survive the baby boom?,"
Carnegie-Rochester Conference Series on Public Policy,
Elsevier, vol. 45(1), pages 89-121, December.
- Cooley, T.F. & Soares, J., 1996. "Will Social Security Survive the Baby Boom?," Papers 96-01, Rochester, Business - General.
- Auerbach,Alan J. & Lee,Ronald D. (ed.), 2001. "Demographic Change and Fiscal Policy," Cambridge Books, Cambridge University Press, number 9780521662444.
- Alan L. Gustman & Thomas L. Steinmeier & Nahid Tabatabai, 2011. "How Did the Recession of 2007-2009 Affect the Wealth and Retirement of the Near Retirement Age Population in the Health and Retirement Study?," NBER Working Papers 17547, National Bureau of Economic Research, Inc.
- Alan L. Gustman & Thomas L. Steinmeier & Nahid Tabatabai, 2011. "How Did the Recession of 2007-2009 Affect the Wealth and Retirement of the Near Retirement Age Population in the Health and Retirement Study?," Working Papers wp253, University of Michigan, Michigan Retirement Research Center.
When requesting a correction, please mention this item's handle: RePEc:ime:imedps:12-e-12. 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: (Kinken)
If references are entirely missing, you can add them using this form.