march 2005 andrew mason, east-west center familial transfers and generational equity: an...

March 2005 Andrew Mason, East-West Center

Familial Transfers and Generational Equity: An Introduction to

National Transfer Accounts

Andrew Mason

East-West Center


Project Overview

• Develop and apply a system of national accounts that – Incorporate age into National Income and

Product Accounts– Estimates of consumption and production– Estimates of intergenerational reallocations

• Saving and the accumulation of other assets• Public programs, e.g., education, health, pensions• Family support systems for children and elderly


Organization

Coordination and US

EWC and CEDA

Japan NUPRI and Statistics Bureau

Indonesia LD, University of Indonesia

Taiwan Academia Sinica

France ENSANS

Chile ECLAC

Brazil Princeton

Funding National Institute on Aging


New Initiative

• NUPRI in collaboration with EWC and CEDA

• Extend project to include China, India, the Philippines, and Thailand

• International Conference in 2007

• Funding request to UNFPA


Lifecycle of production and consumption, Mean Values, Japan, 1999

0

50000

100000

150000

200000

250000

300000

3500000 6 12 18 24 30 36 42 48 54 60 66 72 78 84 90

AgeSource: Statistics Bureau of Japan.

Consumption

Production


Lifecycle of production and consumption, Aggregate Values, Japan, 1999

0

2000

4000

6000

8000

10000

12000

14000


Consumption

Production


Lifecycle Deficit, Aggregate Values, Japan, 1999

-8000

-6000

-4000

-2000

0

2000

4000

6000


Deficits

Surplus


Objectives

• Construct historical estimates and projections of the age profiles of production, consumption, and the lifecycle deficit.

• Explain how they are influenced by – social – economic, and– demographic factors.


Lifecycle Deficit by Age, Japan, 1999 Actual and 1950 Age Distribution

-8000

-6000

-4000

-2000

0

2000

4000

6000

8000

10000

0 10 20 30 40 50 60 70 80 90

Age

1999 actual

1950 ages

Source: NSFIE 1999.


Lifecycle Deficit by Age, Japan, 1999 Actual and 2050 Age Distribution

-8000

-6000

-4000

-2000

0

2000

4000

6000

0 10 20 30 40 50 60 70 80 90

Age

1999 actual

2050 ages

Note. Values for 2050 based on UN low fertility projection and 1999 mean profiles.


Reallocation Systems

• Systems that shift resources across age groups – from workers to dependent children and elderly

• Features of reallocation systems– Market and non-market– Public and Private– Economic form

• Saving and investment• Consumer credit• Transfers


Table 1. A Classification of NTA Reallocations.

Asset Reallocations

TransfersCapital

Reallocations

Property and Credit

Reallocations

PublicPublic infrastructure

Public debtStudent loan

programsMoney

Public educationPublic health careUnfunded pension

plans

Private

HousingConsumer durablesFactories

FarmsInventories

Consumer creditInsurance

Rental of land

Familial support of children and parentsBequestsCharitable contributions

Source: Adapted from Lee 1994.


Intra-household Net Transfers, Japan 1999, Taiwan 1998, and US

-150.0

-100.0

-50.0

0.0

50.0

100.0

150.0

0 10 20 30 40 50 60 70 80Age

Net

Tra

nsfe

rs

Japan

Taiwan

US

Note: Net Transfers are expressed as a percent of per capita private consumption. US values include inter-household private transfers. Age groups w ith positive values are net recipients. Sources: Japan Statistics Bureau and Mason, Lee, Tung, and Lai 2005.


Reallocation Shares, Children 0-19

-20%

0%

20%

40%

60%

80%

100%

120%

Taiwan 1998 US 2000Perc

enta

ge o

f re

allo

cations

Family

Government

Saving

Work

Source: Mason, Lee, Tung, and Lai.


Reallocation Shares, Elderly 65+

-40%

-20%

0%

20%

40%60%

80%

100%

120%

140%

Taiwan 1998 US 2000

Perc

enta

ge o

f re

allo

cations

Family

Government

Saving

Work

Family reallocations include bequests. Bequests were approximately 74% of non-bequest family transfers in Taiwan and approximately 340% in the US. Source: Mason, Lee, Tung, and Lai.


Concluding Comments

• Estimates presented here are preliminary and subject to change.

• Differences between countries are consistent with our expectations.

• Systematic quantification will facilitate important research on alternative support systems and public policy.

march 2005 andrew mason, east-west center familial transfers and generational equity: an...

Documents