Measuring the balance of government intervention on forward and backward family transfers using NTA estimates: the modified Lee arrows

• Published in: International tax and public finance Vol. 19; no. 3; pp. 442 - 461
• Main Authors: Patxot, Concepció, Rentería, Elisenda, Romero, Miguel Sánchez, Souto, Guadalupe
• Format: Journal Article
• Language: English
• Published: Boston Springer US 01-06-2012; Springer; Springer Nature B.V
• Series: International Tax and Public Finance
• Subjects: Aging; Business Taxation/Tax Law; Economics; Economics and Finance; Estate taxes; Families & family life; Fertility; Fertility rate; Fiscal policy; GDP; Generation skipping trusts; Generational accounting; Gross Domestic Product; H53; H68; Indicators; Intergenerational relations; J180; Methodology; National accounting; National transfers accounts; Pensions; Population ageing; Public Finance; Spain; State intervention; Studies; Sustainability; Spain; Fiscal policy; National transfers accounts; Generational accounting; H53; Population ageing; H68; J180; Spain
• ISSN: 0927-5940; 1573-6970
• DOI: 10.1007/s10797-012-9220-5

In this paper we propose a way to measure the degree of government intervention on forward—from parents to children—and backward—from adult children to elderly parents—intergenerational family transfers (IFT). We carry out a discussion about the possibility of using Generational Accounts (GA) and National Transfer Accounts (NTA) methodologies to generate indicators that could measure government intervention on both sides of IFT. As a result, we propose a modification of arrow diagrams used by Lee (in J. Human Res. 29:1027–1063,
1994b
). An illustration of the results in the Spanish case indicates that the degree of government intervention on backward IFT is above that on forward IFT. This could be one of the main reasons to explain the Spanish low fertility rate.