Understanding Financial Accounts

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Understanding Financial Accounts seeks to show how a range of questions on financial developments can be answered with the framework of financial accounts and balance sheets, by providing non-technical explanations illustrated with practical examples: What are the basic principles, concepts and definitions used for this framework which is part of the system of national accounts? What sources and which methodologies are used for their compilation? How are these used to monitor and analyse economic and financial developments? What can we learn about the 2007-2009 economic and financial crisis when looking at the numbers provided in this framework? What can we learn about financial risks and vulnerabilities? This publication is intended for young statisticians, students, journalists, economists, policy makers and citizens, who want to know more about the statistics that are at the heart of the analysis of financial developments in OECD economies.


Accounting for the financial consequences of demographic changes

Many OECD countries are facing pronounced demographic changes, primarily in the form of ageing populations. It is therefore important to not only understand these effects, but to also monitor and analyse their impact on macroeconomic developments. This chapter explains the effects that demographic changes may have on the economy. It starts by explaining how households’ income, consumption and saving vary across age groups and how demographic changes can affect the saving ratio and the net worth of the household sector as a whole. It then analyses the link between demographic changes and governments’ finances and how the sustainability of government finances can be assessed in the light of changing populations. Finally, this chapter discusses the various ways in which pension systems are organised across countries, how they are recorded in the system of national accounts, and how the resulting data can (not) be used to assess their financial sustainability.




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