Poor parents, rich children? - A hundred years of distribution

Billede af publikationens forside
11-10-2005
DREAM

This paper construct a measure of full lifetime incomes and net government contributions for all generations born in Denmark from 1930 to 2030, combining historical figures with future projections on the large computable general equilibrium model DREAM.

Abstract

Conventional generational accounts are insufficient as instruments to judge the appropriateness of policies which may change intergenerational distribution. One of the reasons is that they are forward-looking and hence do not measure the impact of historical events. We construct a measure of full lifetime incomes and net government contributions for all generations born in Denmark from 1930 to 2030, combining historical figures with future projections on the large computable general equilibrium model DREAM. Despite many short-term fluctuations, the resulting development in lifetime income figures is relatively smooth, and net government contributions make up only a modest part of each generation’s consumption possibilities, even though present and expected future tax rates in Denmark make up no less than half of GDP.