I. Introduction -- II. Demographic trends and fiscal pressures -- III. Analytical framework -- IV. The effects of alternative adjustment strategies --- V. Pension board proposals -- VI. Conclusion -- Appendices (I. Parameterization of the model; II. Sensitivity analysis; References)
Summary
The projected rise in age-related government spending as a share of GDP in Ireland over the next forty years is among the highest in the euro area. In the absence of reforms, public debt will increase to unsustainable levels. This paper uses IMF's Global Fiscal Model to compare the macroeconomic effects of different fiscal strategies to accommodate the rise in age-related spending. The simulations suggest that adopting a package of measures, including an increase in the retirement age, broadening the base, and raising indirect taxes, would be a more growth-friendly strategy than relying exclusively on raising the social security contribution rate
Bibliography
Includes bibliographical references (page 15)
Notes
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