Generational Wealth Accounts: did public and private inter-generational transfers offset each other over the financial crisis?

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Title: Generational Wealth Accounts: did public and private inter-generational transfers offset each other over the financial crisis?
Authors: Sefton, J
McCarthy, D
Lee, R
Sambt, J
Item Type: Journal Article
Abstract: We develop Generational Wealth Accounts (GWA): the first set of balance sheets, broken down by generations, to include all human capital, tangible wealth, financial wealth, and transfer wealth, and the uses to which these resources are put. We then use them to measure the size, nature (public or private; capital or current) and direction of inter-generational transfers and assess the sustainability of public and private consumption plans. We confirm that public sector consumption in the UK is unsustainable but show that the private sector is close to balance. Aggregate consumption plans are therefore unsustainable. Although public sector finances worsened significantly over the crisis, the private sector balance improved and capital transfers to the young increased, more than fully offsetting this deterioration. We find that increases in house prices redistributed resources away from the young and towards the old but had little effect on overall sustainability.
Editors: Guner, N
Issue Date: 17-Mar-2022
Date of Acceptance: 28-Feb-2022
URI: http://hdl.handle.net/10044/1/95858
DOI: 10.1093/ej/ueac019
ISSN: 0013-0133
Publisher: Oxford University Press
Journal / Book Title: The Economic Journal
Copyright Statement: © The Author(s) 2022. Published by Oxford University Press on behalf of Royal Economic Society. . This is a pre-copy-editing, author-produced version of an article accepted for publication in The Economic Journal following peer review. The definitive publisher-authenticated version is available online at: https://academic.oup.com/ej/advance-article/doi/10.1093/ej/ueac019/6550017
Sponsor/Funder: Economic & Social Research Council (ESRC)
Funder's Grant Number: ES/P000142/1
Keywords: Economics
14 Economics
Publication Status: Published online
Embargo Date: 2024-03-16
Online Publication Date: 2022-03-17
Appears in Collections:Imperial College Business School