| Table 8: Impact of a 10% permanent and temporary reduction in earned income taxes for workers aged 60 and over when the intertemporal rate of substitution increased, key macroeconomic indicators*. |
| | Macroeconomic indicators | Permanent | Temporary | | 2010 | 2030 | 2050 | 2010 | 2030 | 2050 |
| | Real GDP per capita | 0.06 (−0.02) | 0.06 (0.01) | 0.10 (0.00) | 0.09 (0.01) | 0.19 (0.01) | 0.07 (0.00) | | Labour supply/capita | 0.11 (−0.02) | 0.18 (0.00) | 0.29 (0.01) | 0.13 (0.01) | 0.24 (0.00) | 0.04 (−0.01) | | National savings | −0.25 (0.04) | −0.20 (−0.06) | −0.23 (0.02) | −0.19 (0.00) | 0.25 (0.04) | 0.16 (0.01) | | Capital stock/capita | −0.06 (−0.01) | −0.29 (0.03) | −0.47 (0.00) | −0.03 (0.00) | 0.05 (−0.03) | 0.15 (−0.01) | | Capital/labour ratio | −0.18 (0.01) | −0.54 (0.03) | −0.92 (0.01) | −0.18 (−0.02) | −0.25 (−0.04) | 0.11 (0.00) | | Real wages | −0.05 (0.00) | −0.14 (0.01) | −0.24 (0.00) | −0.05 (0.00) | −0.07 (−0.01) | 0.03 (0.00) | | Earned income tax rate | −0.13 (0.00) | −0.13 (0.00) | −0.14 (0.00) | −0.13 (0.00) | −0.15 (0.00) | −0.01 (0.00) |
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*Percentage point difference against the reference scenario. Values in brackets are differences compared to the first scenario. See Tables 3 and 5. The inter-temporal rate of substitution in the general equilibrium model is increased from 0.9 to 1.1.
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