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This article describes generational accounting (GA) with a focus on what it brings to the broader literature on generational equity. Our assessment suggests that the GA model has its limitations but is potentially useful in the hands of analysts who are familiar with both the strengths and limitations of the model. It is most useful when the focus is on dealing with intergenerational equity, but it is much less useful when the focus is on issues related to class, race, and other forms intragenerational equity. We conclude that when GA models are used to support calls for retrenchment of public spending on pensions and other social programs that target the older population, it makes sense to recognize that the potential benefits with respect to government debt and deficit reduction and reduced inequality in net tax burdens across age cohorts may come at the cost of increased intragenerational inequality for many workers and retirees.
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