Exploring the Sustainability and Equity of the Aging Economy

Population aging challenges the sustainability of fiscal and social security systems. Rising pension outlays to the increasing number of elders also raises a controversial issue of generational equity. This mini review briefly introduces overlapping generation model (OLG) and generational accounting (GA), presented in Auerbach and Kotlikoff (1987) and Auerbach, Gokhale, and Kotlikoff (1991), that are suitable for exploring the issues raised.