IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

General accounting in Belgium: Fiscal sustainability at a glance

Listed author(s):
  • Andre Decoster
  • Xavier Flawinne
  • Pieter Vanleenhove

This paper uses generational accounts as an instrument to analyse the fiscal long term sustainability of Belgian public finances. Age-profiles of detailed tax and expenditure categories are derived from micro data and microsimulation models, and then plugged into a long run demographic projection. We assess fiscal sustainability under current fiscal and budgetary policy for the base year 2010, and perform simulations of counterfactuals to determine the most important factors of the long run unsustainability. The generational accounting exercise shows that the budgetary situation in Belgium is untenable in the long run. However, contrary to what is often put forward in public debates, the current level of explicit debt plays only a minor role in explaining this sustainability problem. The ageing of the population and the related increase in age related expenditures are the main drivers of the long run fiscal imbalance and the high implicit debt. We analyse the generational effects of different tax instruments and expenditure reductions to return to sustainability and further disentangle the generational accounts for the three regions separately. Although the fiscal imbalance is biggest in Wallonia due to lower participation rates and higher unemployment, the projected demographic evolution, and more specifically the ageing of the population, has higher budgetary repercussions in Flanders.

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.

File URL:
Download Restriction: no

Paper provided by Centre de Recherche en Economie Publique et de la Population (CREPP) (Research Center on Public and Population Economics) HEC-Management School, University of Liège in its series CREPP Working Papers with number 1203.

in new window

Date of creation: 2012
Handle: RePEc:rpp:wpaper:1203
Contact details of provider: Postal:
Boulevard du Rectorat, 7, Batiment 31, boite 39, 4000 Liege

Phone: + 32 (0) 4 366 31 08
Fax: + 32 (0) 4 366 31 06
Web page:

More information through EDIRC

References listed on IDEAS
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.:

in new window

  1. André Decoster & Jason Loughrey & Cathal O'Donoghue & Dirk Verwerft, 2010. "How regressive are indirect taxes? A microsimulation analysis for five European countries," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 29(2), pages 326-350.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:rpp:wpaper:1203. 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: (Mathieu Lefebvre)

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 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.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.