Fiscal sustainability of an independent Scotland

Amior, Michael; Crawford, Rowena; Tetlow, Gemma

doi:10.1920/re.ifs.2013.0088

Cited by 4 publications

(6 citation statements)

References 7 publications

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“…To analyse sensitivity to population projections we compare main results with simulations based on the low migration variant of the 2010-based ONS population projections. These are the same projections that were used by the Institute for Fiscal Studies in their recent report on the fiscal sustainability of an independent Scotland (Amior et al ., 2013) and by Crawford and Tetlow (2014). Figure 8 shows OADR for both regions for 2010-based low migration projections.…”

Section: Resultsmentioning

confidence: 99%

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Can an Ageing Scotland Afford Independence?

Lisenkova

Mérette

2014

Natl. Inst. econ. rev.

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Key words: Scotland, independence, OLG, government spending, population ageing JEL codes: C68, E17, H53, J11 Terms of use: Documents in AbstractThe aim and scope of this paper is to isolate the effects of population ageing in the context of potential Scottish independence. A dynamic multiregional Overlapping Generations Computable General Equilibrium (OLG-CGE) model is used to evaluate the two scenarios. The status quo scenario assumes that Scotland stays part of the UK and all government expenditures associated with ageing population are funded on a UK-wide basis. In the independence scenario, Scotland and the rest of the UK pay for the growing demands of the ageing population independently. The comparison suggests that Scotland is worse off in the case of independence. Effective labour income tax rate in the independence scenario has to increase further compared with the status quo scenario. The additional increase reaches its maximum in 2035 at 1.4 percentage points. The additional rise in the tax rate is nonnegligible, but is much smaller than the population ageing effect (status quo scenario) which generates an increase of about 8.5 percentage points by 2060. The difference for government finances between the status quo and independence scenarios is thus relatively small.

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Section: Resultsmentioning

confidence: 99%

“…It is interesting to compare the results presented in this paper with the Institute for Fiscal Studies (IFS) report on the fiscal sustainability of an independent Scotland (Amior et al, 2013) and Crawford and Tetlow (2014) because they address some of the same issues. Our conclusions differ somewhat for a number of reasons.…”

Section: Introductionmentioning

confidence: 97%

Can an Ageing Scotland Afford Independence?

Lisenkova

Mérette

2014

Natl. Inst. econ. rev.

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“…The intrinsically reassuring nature of OBR forecasts is, therefore, another example of the basic point this article seeks to make. The relevance to the Scottish referendum is that two influential London-based think tanks -the Institute for Fiscal Studies (IFS) and the National Institute of Economic and Social Research (NIESR) -have both taken the OBR' s central forecast for the UK as a starting point, and they then disaggregated this forecast to give a consistent forecast for Scotland 3,4 . They then looked at the implications of these "Scottish" forecasts for various aspects of Scotland' s demography and public finances.…”

Section: The Office For Budget Responsibility: Forecasting and Riskmentioning

confidence: 99%

Shaping Things to Come?: How Decisions on Statistical Disclosure and Analysis Influenced the Debate on Scotland's Independence

Cuthbert

2014

Significance

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“…The implication of this is that fiscal action taken in the medium term could make a significant difference to the projected outlook for borrowing and debt illustrated in Figures 6.7 and 6.8. Amior, Crawford and Tetlow (2013) discusses in more detail the scale of fiscal tightening that would be required to put the Scottish public finances on a sustainable footing for the next 50 years.…”

Section: 2mentioning

confidence: 99%

“…A fuller discussion of the outlook for the Scottish public finances, illustrating the sensitivity of the projections described in Section 6.2 to these assumptions, is contained in Amior, Crawford and Tetlow (2013). …”

Section: Alternative Modelling Assumptionsmentioning

confidence: 99%