National transfer accounts of Moldova-2019: principals of construction and some results

Abstract

In the coming decades, in Moldova, as well as in other countries of Eastern Europe, the demographic aging of the population will have a significant impact on economic development. Thus, improving social policies to reduce the negative consequences of demographic changes and ensure a decent standard of living for different generations will be necessary. National transfer accounts (NTA) are a tool which identifies the relationship between the population's age structure, economic behavior during the life cycle and the system of intergenerational support to determine the role of the state and the private sector in covering consumption costs.

The article presents the experience of NTA construction for Moldova based on 2019 data. According to the results, the size of the economic life cycle deficit (LCD) in 2019 amounted to 67.6 billion lei, or 59.1% of total labor income and 32.1% of real GDP. The labor income of the population of Moldova exceeds consumption in the short interval from 30 to 48 years (19 years), due to the low level of employment and the high level of international migration. The volume of private transfers to cover the LCD is much larger than the public transfers. Remittances from international migrants (transfers between households) play a significant role in covering the LCD.