| Table 7: Impact of a 10% permanent and temporary reduction in earned income taxes for workers aged 60 and over with a lower intratemporal elasticity of substitution key macroeconomic indicators*. |
| | Macroeconomic indicators | Permanent | Temporary | | 2010 | 2030 | 2050 | 2010 | 2030 | 2050 |
| | Real GDP per capita | 0.05 (−0.03) | 0.05 (0.00) | 0.05 (−0.05) | 0.08 (0.00) | 0.17 (−0.03) | 0.08 (0.01) | | Labour supply/capita | 0.10 (−0.03) | 0.17 (−0.01) | 0.25 (−0.05) | 0.13 (0.01) | 0.22 (−0.02) | 0.06 (0.01) | | National savings | −0.27 (0.02) | −0.15 (−0.01) | −0.24 (0.01) | −0.20 (0.01) | 0.36 (0.15) | 0.18 (0.03) | | Capital stock/capita | −0.06 (−0.01) | −0.30 (0.02) | −0.55 (−0.08) | −0.03 (0.00) | 0.00 (−0.08) | 0.14 (−0.02) | | Capital/labour ratio | −0.16 (0.03) | −0.54 (0.03) | −0.95 (−0.02) | −0.17 (−0.01) | −0.29 (−0.08) | 0.08 (−0.03) | | Real wages | −0.05 (0.00) | −0.14 (0.01) | −0.24 (0.00) | −0.05 (0.00) | −0.08 (−0.02) | 0.02 (−0.01) | | Earned income tax rate | −0.14 (−0.01) | −0.14 (−0.01) | −0.13 (0.00) | −0.15 (−0.02) | −0.16 (−0.01) | −0.01 (0.00) |
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*Percentage point difference against the reference scenario. Values in brackets are differences compared with the first scenario. See Tables 3 and 5. The substitution elasticity between consumption and leisure in the general equilibrium model is reduced from 0.8 to 0.6.
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