Quantifying Impact of Aging Population on Fiscal Space

This paper quantitatively investigates how population aging trend affects fiscal space measured as unused revenue generating capacity by utilizing a standard neoclassical growth model. A calibration exercise for G-7 countries shows that France, Germany and Italy suffer greater revenue impact from a given reduction in hours worked due to their larger government expenditure. Corrective measures such as pension reform and flexible expenditure policy would be required in order to mitigate the impact of aging on fiscal space.

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Year of publication:	2012-06-01
Authors:	Park, Seok Gil
Institutions:	International Monetary Fund (IMF)
Subject:	Aging \| Economic models \| Group of seven \| Labor supply \| Tax revenues \| tax rates \| fiscal space \| tax rate \| tax revenue \| government expenditure \| fiscal policy \| tax bases \| tax base \| pension \| taxation \| expenditure policy \| labor income \| fiscal sustainability \| pension reform \| government spending \| retirement \| labor force \| pension reforms \| dependency ratio \| fiscal affairs department \| fiscal limits \| retirement age \| fiscal affairs \| fiscal balance \| national accounts \| fiscal deficits \| government budget \| fiscal stress \| public finance \| taxable income \| budget constraint \| government budget constraint \| public pension \| labor force participation \| government revenue \| public pension reforms \| fiscal deficit \| life expectancy \| aging population \| fiscal impact

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Extent:	application/pdf
Series:	IMF Working Papers.
Type of publication:	Book / Working Paper
Notes:	The text is part of a series IMF Working Papers Number 12/164 2 pages long
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10010790302