Generational Accounting and the Saving Rate Decline, 1960-2000

Government agencies in 26 countries construct generational accounts, defined as the present value of remaining lifetime net taxes that a generation can expect to pay. This paper calculates generational accounts for the United States, 1960–2000, and finds that generational account changes do not coin...

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Bibliographic Details
Published in:Public budgeting & finance 2005-03, Vol.25 (1), p.46-65
Main Author: Eschker, Erick
Format: Article
Language:English
Subjects:
Age
Baby boomers
Budget deficits
Females
Fiscal policy
Forecasts
Generations
Governmental accounting
Males
Medicare
Present value
Retirement
Savings
Social security
Studies
Taxation
Taxes
Transfer payments
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Summary:Government agencies in 26 countries construct generational accounts, defined as the present value of remaining lifetime net taxes that a generation can expect to pay. This paper calculates generational accounts for the United States, 1960–2000, and finds that generational account changes do not coincide with the abrupt decline in the saving rate that began in the mid‐1980s. First, transfers to the elderly, as reflected in changes to the generational accounts, increased gradually after 1960. Second, the fiscal burden placed on future generations, measured both in real terms and relative to newborns, was no higher in 2000 than in 1960.
ISSN:0275-1100
1540-5850
DOI:10.1111/j.0275-1100.2005.00354.x