Generational Accounts, Aggregate Savings, and Intergenerational Distribution

Author/Editor:

Willem H. Buiter

Publication Date:

July 1, 1996

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

Are generational accounts informative about the effect of the budget on the intergenerational distribution of resources and on aggregate saving? First, the usefulness of generational accounts lives or dies with the strict life-cycle model of household consumption. Second, even if the life-cycle model holds, generational accounts ignore the intergenerational redistribution associated with the government’s provision of public goods and services and with intergenerational externalities. Third, generational accounting ignores the effect of the budget on tax and transfer bases and on before-tax incomes and prices. That is, it does not handle incidence or general equilibrium repercussions.

Series:

Working Paper No. 1996/076

Subject:

Budget planning and preparation Capital income tax Consumption Income Labor

English

Publication Date:

July 1, 1996

ISBN/ISSN:

9781451849820/1018-5941

Stock No:

WPIEA0761996

Pages:

32

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