Diminishing Prospects for Young People: A Comparison of the Intergenerational Fairness Index and Generational Divide Index in Addressing the Problem

Luciano Monti

doi:10.5539/res.v9n4p160

Abstract

This paper focuses on the origins of the generational divide, namely, the unsustainability of national policies that have disproportionately benefitted the older generations to the detriment of younger generations. Much of southern Europe remains mired by unacceptably high rates of youth unemployment, which leaves an indelible scar on young people, poses economic problems for future generations, and threatens the European economies competitiveness. This paper outlines and compares the objectives, methodologies and results of two cutting-edge approaches in identifying the extent of these generational imbalances, namely: the Intergenerational Foundation’s Intergeneration Fairness Index (IFI) and the Bruno Visentini Foundation’s Generational Divide Index (GDI). The findings outline the differing objectives and methodologies of these respective approaches. Although both instruments arrive at broadly similar conclusions, (i.e. young people’s diminishing prospects over time) there are palpable differences in the results. This is attributable to IFI and GDI’s different aims and objectives: IFI is mainly helpful for country comparisons and GDI for fixing country-specific targets.

Highlights

It is challenging to estimate the impact and measure the intensity of unsustainable growth of young generations (United Nations, 2013), since the recent recession is the product of many factors
In today’s usage, the reference “generational gap” habitually refers to a perceived gap between young people and their parents or grandparents. This term is unrelated to the research into the generational divide or intergenerational fairness
In order to carry out an apposite comparison between the Intergeneration Fairness Index (IFI) and Generational Divide Index (GDI) results, the Bruno Visentini Foundation extracted the IFI’s European data from 2004, and normalized the figures to an index of 100 to correspond with GDI data series

Summary

Introduction

It is challenging to estimate the impact and measure the intensity of unsustainable growth of young generations (United Nations, 2013), since the recent recession is the product of many factors. From a macroeconomic point of view, the gravity center displacement of big flows of the global economy to some geographic areas (such as China and other Asian countries) is one of the main causes for the geopolitical decline of Europe. Another cause was some of the policies of European integration, which have contributed to the current economic imbalances in Europe, most notably with the creation of the single market, first, and the ongoing European monetary union, second. Elements to take into consideration to assess the intensity are mainly linked to three areas: i) economic stability ii) number of NEETs (Young People Not in Employment, Education or Training); and iii) youth unemployment rate

Methods

Results

Conclusion