 The savings gap in HungaryRóbert Iván Gál and Árpád Törzsök The Journal of the Economics of Ageing, 2020, vol. 17, issue C Abstract: In a simple cohort model we carry out a projection based on current per capita age profiles of labour income and consumption and combine them with expected future age compositions. We use 2012 Hungarian data. Due to a shrinking and ageing population this exercise predicts a growing gap between labour income and consumption implying that the difference would be covered by asset-based revenues. We apply two balancing items: a windfall capital endowment in the base year, and gradual capital accumulation through higher savings. We also quantify how much the household economy, an integral but unregistered part of a modern economy, can absorb the effects of ageing. In addition, we test against a model using demographic data from 1995. The two decades between the mid-1990s and the mid-2010s offered a special demographic opportunity for Hungary and coincided with the botched pre-funding experiment in the public pension system. We demonstrate the potential of this missed opportunity. Keywords: Macroeconomic consequences of demographic trends; National Transfer Accounts; Unpaid household labour; Pension reform (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:joecag:v:17:y:2020:i:c:s2212828x16300767 DOI: 10.1016/j.jeoa.2017.05.002 Access Statistics for this article The Journal of the Economics of Ageing is currently edited by D.E. Bloom, A. Sousa-Poza and U. Sunde More articles in The Journal of the Economics of Ageing from Elsevier |
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