ESRI Discussion Paper Series No.248
Inter- and Intra- generational Inequality

Minoru MASUJIMA
(Senior Research Fellow, Economic and Social Research Institute, Cabinet Office)
Manabu SHIMASAWA
(Associate Professor, Faculty of Education and Human Studies, Akita University)
Goro TANAKA
(Economic and Social Research Institute, Cabinet Office)
Masahiro SUGISHITA
(Former Research Officer, Economic and Social Research Institute, Cabinet Office)
Hiroshi YAMAMOTO
(Economic and Social Research Institute, Cabinet Office)
Makoto TAKANAKA
(Economic and Social Research Institute, Cabinet Office)

The full text is written in Japanese.

Abstract

The purpose of this paper is to quantify intragenerational inequality among income brackets and places of residence. To this end, the paper has estimated lifetime benefits and burdens of each cohort by using the generational accounting model. Assuming the status quo, a person with higher income would shoulder more lifetime net burden. The same is true for a person living in a place with higher income. If the primary fiscal balance improved by 8% of GDP since 2015, fiscal sustainability would be maintained. It should be noted that Lifetime burdens need to be taken into consideration in the case of consumption tax hike. In the rural area, where ageing ratio is higher and grows faster than in the metropolitan area, burdens for medical and old-age care may become higher. As public investment would bring higher benefits to the rural area with lower income, it has a certain role of income redistribution but not so much as taxes and social security.

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