Population Aging and Intergenerational Transfers: Introducing Age into National Accounts

In all societies intergenerational transfers are large and have a strong influence on inequality and growth. The development of each generation of youth depends on the resources that productive members of society devote to their health, education, and sustenance. The well-being of the elderly depends on familial support and a variety of social programs. The National Transfer Accounts (NTA) system provides a comprehensive approach to measuring all inter-age transfers at the aggregate level. It encompasses reallocations achieved through capital accumulation and transfers, distinguishing those mediated by public institutions from those relying on private institutions such as the family. This paper introduces the methodology and presents preliminary results emphasizing economic support systems in Taiwan and the United States. As the two economies differ in their demographic configuration, their level of development, and their old-age support systems, a comparison of the two sheds light on the economic implications of alternative institutional approaches to providing for the elderly under population aging.