Marchiori, Luca
[Verfasser:in]
;
Pierrard, Olivier
[Sonstige Person, Familie und Körperschaft];
Sneessens, Henri R.
[Sonstige Person, Familie und Körperschaft]
Aging, Labour Market Dynamics and Fiscal Imbalances
Erschienen in:National Bank of Poland Working Paper ; No. 122
Umfang:
1 Online-Ressource (35 p)
Sprache:
Englisch
DOI:
10.2139/ssrn.2163502
Identifikator:
Entstehung:
Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments October 1, 2012 erstellt
Beschreibung:
Population aging is a phenomenon common to all regions in the developed world, forcing most governments to implement structural reforms in order to avoid the development of fiscal imbalances. In Luxembourg, large inflows of – young – foreign workers generate an apparently sound public pension system, although no major structural reform has been implemented yet. In this paper, we study the interactions between demographic changes, labour market dynamics and public finance, by building an overlapping generations structure with New Open Macroeconomics and labour market frictions à la Diamond-Mortensen-Pissarides. We calibrate the model on Luxembourg data and we show that foreign labour inflows are a palliative but not a long term solution to the fiscal consequences of aging, and that only deep – and unpopular – fiscal reforms could solve the expected deficit problem. We also show that without foreign trade, foreign labour inflows would increase the domestic unemployment rate. This underlines the need to combine in a single framework the NOEM and the search and matching approaches