NTA2020 Herranz-Loncan

Global Meeting on Population and the Generational Economy, August 2020

Presentation: Alfonso Herranz-Loncan, Guadalupe Souto, Sergio Espuelas-Barroso, Gemma Abio, Concepcion Patxot, The evolution of public and private transfers between age groups in Spain: the impact of demography and the welfare state

Abstract

This paper is part of the National Transfer Accounts project (NTA), which estimates transfers between age groups in different economies today. This paper extends the Spanish estimates to the past, to analyse changes in intergenerational transfers associated to the demographic transition and welfare state development. We provide NTA age profiles for 1980-2012, based on the available HBS and, also, a NTA estimate earlier periods, based of different historical sources containing data on demography, public finance and labour and capital markets. The longitudinal analysis of NTA allowed us to observe changes in the Spanish reallocation system during the second half of the 20th century and the first decade of this century. The estimations show that, by the mid-20th century, Spain was a typical low-income country, with a minor role of government transfers. From the 1970s, public transfers have grown larger and have increased their importance in the reallocation system, although with an important bias towards financing the consumption of the elderly. This was sustainable during the early stages of the construction of the welfare estate, but today represents a difficult challenge due to the significant ageing process the country is facing.

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