IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/6447.html
   My bibliography  Save this paper

An International Comparison of Generational Accounts

Author

Listed:
  • Laurence J. Kotlikoff
  • Willi Leibfritz

Abstract

This paper summarizes findings reported in a forthcoming NBER volume entitled 'Generational Accounting Around the World.' This volume includes generational accounting studies for 17 countries. The findings are shocking. The world's leading industrial powers - the U.S., Japan, and Germany - all have severe imbalances in their generational policies. Unless currently living members of these countries pay more in net taxes or unless these countries cut their purchases of goods and services, future Americans, Japanese and Germans will face much higher rates of lifetime net taxation. Leaving current Americans untouched and maintaining the current projected time-path of government purchases will leave future Americans collectively facing about 50% higher net tax rates over their lifetimes than those facing a newborn American based on current U.S. tax-transfer policy. For future Germans, the imbalance means they would face lifetime net tax rates that are roughly twice as high as those now in place. And for future Japanese, policy inaction means lifetime net tax rates that are more than 2.5 times are high as current values. Other countries are also running imbalanced policies. Of the 17 countries studied here, five (Japan, Italy, Germany, The Netherlands, and Brazil) have extreme imbalances. Another five (the United States, Norway, Portugal, Argentina and Belgium) have severe imbalances. Three countries - Australia, Denmark and France - have substantial imbalances. Canada's appears to be essentially in generational balance. The remaining countries - New Zealand, Thailand, and Sweden - have negative imbalances; i.e. their policies, if maintained, would leave future generations facing lower lifetime net tax rates than current current newborns.

Suggested Citation

  • Laurence J. Kotlikoff & Willi Leibfritz, 1998. "An International Comparison of Generational Accounts," NBER Working Papers 6447, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:6447 Note: PE
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w6447.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. David M. Cutler & James M. Poterba & Louise M. Sheiner & Lawrence H. Summers, 1990. "An Aging Society: Opportunity or Challenge?," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 21(1), pages 1-74.
    2. Nicola Sartor, 2001. "The Long-run Effects of the Italian Pension Reforms," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 8(1), pages 83-111, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Nicola Sartor, 2001. "The Long-run Effects of the Italian Pension Reforms," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 8(1), pages 83-111, January.
    2. Bernd Raffelhuschen & Laurence J. Kotlikoff, 1999. "Generational Accounting around the Globe," American Economic Review, American Economic Association, vol. 89(2), pages 161-166, May.
    3. Beetsma, Roel & Bettendorf, Leon & Broer, Peter, 2003. "The budgeting and economic consequences of ageing in the Netherlands," Economic Modelling, Elsevier, vol. 20(5), pages 987-1013, September.
    4. Frank T. Denton & Byron G. Spencer, 1998. "Economic Costs of Population Aging," Quantitative Studies in Economics and Population Research Reports 339, McMaster University.
    5. Carole Bonnet, 2002. "Comptabilité générationnelle appliquée à la France : quelques facteurs d'instabilité des résultats," Économie et Prévision, Programme National Persée, vol. 154(3), pages 59-78.
    6. Robert Fenge & Martin Werding, 2004. "Ageing and the tax implied in public pension schemes: simulations for selected OECD countries," Fiscal Studies, Institute for Fiscal Studies, vol. 25(2), pages 159-200, June.
    7. Karin Mayr, 2004. "The fiscal impact of immigrants in Austria--a generational accounting analysis," Economics working papers 2004-09, Department of Economics, Johannes Kepler University Linz, Austria.
    8. Kyrre Stensnes & Nils Martin Stølen, 2007. "Pension Reform in Norway. Microsimulating effects on government expenditures, labour supply incentives and benefit distribution," Discussion Papers 524, Statistics Norway, Research Department.
    9. Dennis Fredriksen & Nils Martin Stølen, 2005. "Effects of demographic development, labour supply and pension reforms on the future pension burden," Discussion Papers 418, Statistics Norway, Research Department.
    10. Alan J. Auerbach & Young Jun Chun & Ilho Yoo, 2005. "The Fiscal Burden of Korean Reunification: A Generational Accounting Approach," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 61(1), pages 1-62, March.
    11. Kotlikoff, Laurence J., 2002. "Generational policy," Handbook of Public Economics,in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 4, chapter 27, pages 1873-1932 Elsevier.
    12. Karin Mayr, 2005. "The Fiscal Impact of Immigrants in Austria – A Generational Accounting Analysis," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 32(2), pages 181-216, June.
    13. Jagadeesh Gokhale & Laurence J. Kotlikoff, 1998. "Medicare from the Perspective of Generational Accounting," NBER Working Papers 6596, National Bureau of Economic Research, Inc.
    14. repec:eee:joecag:v:8:y:2016:i:c:p:52-66 is not listed on IDEAS
    15. Giang, Thanh Long, 2004. "The Pension Scheme in Vietnam: Current Status and Challenges in an Aging Society," MPRA Paper 969, University Library of Munich, Germany.
    16. Frank T. Denton & Byron G. Spencer, 1999. "Population Aging and Its Costs: A Survey of the Issues and Evidence," Department of Economics Working Papers 1999-03, McMaster University.
    17. Kamil Dybczak, 2006. "Generational Accounts in the Czech Republic," Working Papers 2006/2, Czech National Bank, Research Department.
    18. repec:eee:joecag:v:3:y:2014:i:c:p:71-83 is not listed on IDEAS
    19. Kenneth N. Kuttner & Adam S. Posen, 2002. "Passive Savers and Fiscal Policy Effectiveness in Japan," Working Paper Series WP02-2, Peterson Institute for International Economics.
    20. Auerbach, Alan J. & Chun, Young Jun, 2006. "Generational accounting in Korea," Journal of the Japanese and International Economies, Elsevier, vol. 20(2), pages 234-268, June.
    21. Robert Fenge & Martin Werding, 2003. "Ageing and Fiscal Imbalances Across Generations: Concepts of Measurement," CESifo Working Paper Series 842, CESifo Group Munich.

    More about this item

    JEL classification:

    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:6447. 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: (). General contact details of provider: http://edirc.repec.org/data/nberrus.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.