Theoretical analyses of social security systems financed by VAT and fiscal policies

2019 Fiscal Year Final Research Report

• Project/Area Number: 17K18032
• Research Category: Grant-in-Aid for Young Scientists (B)
• Allocation Type: Multi-year Fund
• Research Field: Economic theory; Public finance/Public economy
• Research Institution: The University of Kitakyushu
• Principal Investigator: Maebayashi Noritaka 北九州市立大学, 経済学部, 准教授 (30735733)
• Project Period (FY): 2017-04-01 – 2020-03-31
• Keywords: 年金目的消費税 / 公的年金 / 経済成長 / 所得再分配政策 / 財政の持続可能性 / 財政赤字

Outline of Final Research Achievements

This research investigates how unfunded public pensions financed by value added tax (VAT) affect economic growth and whether payroll tax (PT) or VAT is the more growth‐friendly tax structure for financing public pensions. Using overlapping generations models with parental altruism, we find that a public pension system financed by VAT may increase economic growth when bequests are operative. By contrast, when bequests are inoperative, public pensions hinder growth unless agents are sufficiently patient. Finally, public pensions financed by VAT are more growth‐friendly than those financed by PT.
This research also investigate the relationship between the sustainability of public debt and inequality in a growth model with heterogeneous agents. We show that an increase in the deficit ratio or the redistributive tax makes public debt less sustainable. If the economy falls into the unsustainable region as a result of the policy change, both public debt and inequality continue to increase.

Free Research Field

財政学・マクロ経済学

Academic Significance and Societal Importance of the Research Achievements

少子高齢化が進む日本や諸外国において、年金財政・財政全般についていかに持続可能にし、国民生活を安心なものにしていくかという問題は重要なテーマである。財源の安定的な確保には①経済成長により財源の基となる所得を増やしていくこと、②消費税増税などによる幅広い財源確保の在り方を考察していく必要がある。この研究では、これらの視点から年金目的消費税の経済分析を通じて、消費税は投資をゆがめにくいことがわかり、年金所得が教育や遺産を通じて若い世代への投資に回ることで経済成長を促進し安定的な財源になりうること、そして所得再分配政策と財政の持続可能性という公共経済学の問題について新たなインプリケーションが示せた。