8. Resultados y análisis
12.2. Listado de ficheros
In order to look at the possible effects of the economic crisis, three scenarios for medium and long terms economic growth have been modelled in addition to the baseline scenario. These are presented in Graph IV.1.1 for EU 27. It should be noted, that the trajectory of growth differs between Member States and that the EU27 average may hide substantially different developments and prospects among member states. (20)
The baseline scenario shows a gradual reduction in potential growth due to population ageing, as explained in previous chapters. This scenario assumes that the loss in output in 2008–10 is of a cyclical nature without a durable impact on current and projected potential. This scenario is basically the same that one could have prior to the emergence of the crisis. Though it is labelled
(20) The calculations for the alternative scenarios are based on
the Commission's spring 2009 forecasts of May 2009 and therefore an update on those presented in the 2009 Ageing Report, which were based on the January 2009 forecast.
‘baseline’ and most indicators in this report are based on that scenario, it appears at this stage an overoptimistic scenario.
The first alternative scenario, ‘the rebound,’ is also of an optimistic nature. Though it acknowledges a loss in potential growth as measured by the usual techniques, during the crisis years, it assumes a rebound in potential growth the years until 2020 or so, with the longer-term outcomes being unchanged.
The ‘lost decade’ scenario shows potential growth taking ten years to return to its pre-crisis level; both labour productivity and labour input are assumed to reach the baseline growth rate in 2020. Thereafter it follows the same path as in the absence of the crisis, but the output lost during the crisis years is definitely lost.
The most pessimistic scenario is the ‘permanent shock’ scenario, where not only is there no rebound, but there is a permanent hit to potential growth going forward. In this case, labour productivity growth and labour input are assumed to be permanently lower due to the crisis. This appears to be an over pessimistic scenario.
Graph IV.1.1: Potential GDP growth compared: different crisis scenarios (annual % change)
0 0.5 2008 2011 2014 2017 2020 2023 2026 2029 2032 2035 2038 2041 2044 2047 2050 2053 2056 2059 1 1.5 2 2.5 3 3.5 4 Rebound Lost decade Permanent shock Baseline
Source: Commission services
European Commission Sustainability Report - 2009
The effects on the level of real GDP per capita of the three scenarios, relative to the baseline are shown in Table IV.1.1. As over the first few years, trend growth follows the 2009 spring forecasts in all cases, the initial loss in GDP by 2010 equals 2% in all cases. Thereafter, in the rebound scenario, GDP per capita continues to fall but has
caught up by 2020 when the recover is complete. This is not the case in the either scenarios where annual GDP growth over 2007-2020 is on average 0.8-0.9% lower than in the baseline. In the lost decade scenario, despite potential growth having reached its pre-crisis level by 2020, the years of the crisis leave a level effect equal to 11% of the Table IV.1.1: The effects on the level of real GDP per capita of the three post-crisis scenarios
2010 2015 2020 2040 2060
Rebound -2 -6 0 0 0
Lost decade -2 -9 -11 -11 -11
Permanent shock -2 -9 -12 -16 -20
EU27 Level of GDP per capita, difference from baseline in %
Source: Commission services
Box IV.1.1: Estimating the impact on pension spending of changes in macroeconomic variables.
For the analysis in this report, the potential budgetary impact of varying the underlying assumptions (productivity, employment) on pension spending, is estimated by the Commission using the sensitivity scenarios on the labour productivity growth rate and the structural unemployment rate, rather than by the Member States using the national pension models.
The elasticity of public pension expenditure with respect to changes in GDP is calculated as follows:
⎟⎟
⎠
⎞
⎜⎜
⎝
⎛
−
⎟⎟
⎠
⎞
⎜⎜
⎝
⎛
−
=
baseline t baseline t scenario alt t baseline t baseline t scenario alt t scenario alt tGDP
GDP
GDP
P
P
P
. . .ε
(1)where: P: pension expenditure (level) GDP: GDP (level)
alt.scenario: the higher labour productivity scenario and the higher employment rate scenario, respectively
This elasticity is time-varying so as to capture potential changes over time that pension reforms might have induced in the relationship between GDP growth and pension expenditure.
Using the estimated elasticity, the alternative 'crisis' scenario is imposed as the 'alt.scenario', and the change in pension expenditure vis-à-vis the baseline is solved for. The alternative scenarios for pension expenditure carried out in the projection exercise relate to specific shocks (the 0.25 p.p higher labour productivity growth rate and 1 p.p. lower structural unemployment rate). For shocks of a different size, the calculated elasticity above can be used as a proxy for the effect of such a shock on pension expenditure. However, it should be noted that the elasticity with respect to a shock of a different size might be different. This would occur if there are non-linearities in the relationship. This simple model does not reflect such cases.
Chapter IV The potential impact of the current economic crisis and sensitivity analysis
baseline GDP per capita. This will never be caught up. The permanent effect on growth in the permanent shock scenario is more dramatic however; in this case the lower rate of growth leads to an ever increase difference in level in GDP per capita going forward. While in 2020 GDP per capita is 12% lower than in the baseline, but 2060 it is 20% lower.
1.3. THE BUDGETARY IMPACT OF THE POST-