Private asset income in France: Is there a breakdown of intergenerational equity between 1979 and 2011?

Abstract

We use the National Transfer Accounts methodology to calculate private asset income by age for the years 1979-2011. We analyze age profiles using three indicators of intergenerational equity. Monetary asset income shows no evidence of generational breaks to the benefit of the baby-boom generation. On the contrary, baby-boomers suffered from the high interest rates that they paid to become homeowners. Imputed rents show an obvious breakdown of intergenerational equity when we use an inter-age and intergenerational indicator. This indicator compares the per capita asset income at a given age with the average asset income of people aged 18-85. It gives the relative situation of one age group compared to its contemporaries and it also gives the relative situation of one generation when we compare birth cohorts over time. We find that the cohort born in 1950 benefited from a better position than their successors. Moreover, the cohorts born before the war and during the war appear to be even more favored than the baby-boomers. The cohorts born in 1930 and in 1940 have a better situation than the previous generations and a better position than the following generations.