Abstract WP10-01

Edwards, Ryan D. 2010. Forecasting Government Revenue and Expenditure in the U.S. Using Data on Age-Specific Utilization

Government finances depend on a vast array of variables, but there is a clear hierarchy among them, and forecasting requires a parsimonious treatment of complicated budget rules and behavior. The number of people paying taxes or receiving benefits and the intensity by which they do so are the most fundamental of these inputs. In this paper, we describe our approach to forecasting federal and state and local government finances using forecasts of the U.S. population by age and sex and measures of our assumptions about the intensity of program utilization by age and sex, or “age profiles” in common usage.

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