My vision: organizing our economy without compromising the economic prospects and wellbeing of future generations. Such future-oriented vision of the economy is supported by economic research that explicitly adopts a generational perspective. The generational-economy blog summarizes my work on measuring the generational economy, focusing on three core-topics:
- Intergenerational transfers: Intergenerational redistribution through public and private transfers
- Generational fairness: The economic situation of different generations and its change over time
- Beyond GDP: Measuring the economy with a focus on sustainable wellbeing for all generations
Our life course is shaped by long periods of economic dependency in childhood and old age. Parents provide for the needs of children through private transfers, while old-age provision is mainly organized through public transfers. The economic value of intergenerational transfers is huge: During working age, about half of income is redistributed to children and the population in retirement.
Understanding current demographic and economic developments and their interrelation requires knowledge about size and direction of private transfers within families and of government transfers. My work on intergenerational transfers focuses on the age and gender-specific amounts and includes monetary transfers as well as transfers of services produced by unpaid work.
Inequality has a strong generational component. For example, the costs of the financial and the sovereign debt crisis in Mediterranean countries were mainly borne the young population, while employment of older workers and income of retirees have been strongly protected. The low fertility in these countries is likely also a consequence of how the crises affected the young adult population.
Both economic and demographic trends can be better understood with an analysis of the economy from a generational perspective. This includes the analysis of income trends by age and gender and measuring public redistribution between generations and income groups in European countries.
Beyond GDP: Measuring “the economy”
Many of the widely used economic concepts and indicators do not capture the aspects of our economies and societies that are relevant in the 21st century. GDP belongs to these outdated concepts and indicators: it is completely blind towards the future — and suffers from a series of other deficiencies.
“Beyond GDP” summarizes the efforts to design indicators that capture those aspects of societies that are relevant for the 21st century. Many of these indicators are highly relevant for the generational economy, by adopting a long-term perspective on the value and the costs of economic activities.