Draft:Generational Divide

Generational Divide

The generational divide refers to the accumulated delay experienced by one generation in achieving key personal and professional growth milestones compared to preceding generations considering the obstacles hindering the attainment of full social and economic maturity.

Origins

The concept of the generational divide has been shaped by the evolution of sustainability thinking, particularly through the integration of bioeconomic and long-term economic models. Economists and policymakers have increasingly recognized that well-being should not be measured solely by gross domestic product (GDP), but must include intergenerational equity, environmental integrity, and social cohesion.

The urgency of addressing the generational divide has intensified in recent decades due to two main factors. Firstly, successive economic and financial crises have exposed the limitations of traditional economic models and widened the gap between generations. The so-called “baby boomer” generation, which benefited from rising prosperity and strong welfare systems, is contrasted with younger cohorts—initially Millennials, now Generation Z— who face precarious labor markets, housing insecurity, and limited access to social protections. Secondly, the ecological and digital transitions underway across Europe require large-scale investments that disproportionately burden today’s youth and future generations.

Informed by the principle of intergenerational equity, contemporary economic policy increasingly aims to guarantee that future generations enjoy a quality of life and level of opportunity comparable to those of present generations. This approach is central to the concept of integrated sustainability, which addresses not only environmental stewardship but also fiscal, social, and generational responsibilities. It seeks to reduce both ecological debt and the social debt accrued at the expense of younger and future populations.

In response to these trends, the European Union has increasingly acknowledged the need to institutionalize intergenerational fairness. While the EU Treaties do not yet contain explicit legal guarantees for future generations, efforts have emerged to integrate their interests into governance. In 2025, the European Commission created the position of Commissioner for Intergenerational Fairness to oversee the development of forward-looking policies. The Commission is also considering the introduction of an Intergenerational Fairness Index, which would assess the distributional effects of public policies across age groups and evaluate long-term sustainability criteria in policymaking processes.

A growing body of constitutional and legal frameworks at national and EU levels has begun to formalize the principle of intergenerational responsibility. These frameworks recognize that the rights and interests of future citizens require legal protection and institutional representation. Integrated sustainability approaches increasingly include not only environmental goals, but also social and economic objectives aimed at reducing intergenerational debt. This debt is defined as the accumulation of obligations, burdens, or diminished resources passed on to future generations due to short-term policymaking or underinvestment in long-term priorities.

The first attempt to measure the generational divide

In socio-economic analysis, it is important to distinguish between the concepts of intergenerational equity, generational gap, and generational divide, which are often used interchangeably but refer to distinct phenomena.

The generation gap primarily relates to cultural, value-based, and behavioral differences between generations, such as those between the so-called "baby boomers" and "Generation Z," and is the focus of sociological and communication studies. Intergenerational equity, on the other hand, is a principle of distributive justice that implies a duty on current generations not to compromise the well-being and development opportunities of future generations.

European Intergenerational Fairness Index (UK).

The first pioneering attempt to specifically measure intergenerational equity was developed in the United Kingdom by the Intergenerational Foundation, established in 2011.

It features a taxonomy composed of nine domains: unemployment, access to housing, pensions, public debt, democratic participation, health, income, environmental impact, and education. The latter is particularly comprehensive and includes a basket of four indicators: not only the level of public spending on education, but also the average costs required to obtain a diploma, the rate of higher education attainment, and the use of student loans. The aim of the Intergenerational Fairness framework is to compare different regions of the country in terms of the delay accumulated by younger generations in achieving social and economic maturity.

Italian approach to the generational divide

The Italian Constitution includes provisions relevant to intergenerational equity, notably the principles of solidarity (Article 2), equality (Article 3), and the protection of the environment and future generations (Article 9). These articles affirm that equality before the law and access to civil and social rights require the removal of systemic barriers that prevent their universal enjoyment.

In 2011, the Italian National Institute of Statistics (ISTAT) and the National Council for Economics and Labour (CNEL) developed the “Equitable and Sustainable Well-being” (Benessere Equo e Sostenibile – Bes) framework, introducing a set of indicators to complement GDP in assessing national progress. The BES includes 12 domains and over 130 indicators aimed at measuring quality of life, economic equity, and environmental sustainability. Italy is also committed to the United Nations 2030 Agenda for Sustainable Development, adopted in 2015, which promotes an integrated model of economic, social, and environmental sustainability through 17 goals, 169 targets, and more than 240 indicators, to be periodically monitored by the UN. In 2014, the Club of Latina, under the scientific coordination of Professor Luciano Monti, initiated a research project to measure the generational gap in Italy. Inspired by the UK's Intergenerational Fairness Index and the Commonwealth Youth Development Index, the project led to the development of the Generational Divide Index (GDI). The GDI is based on 27 annually measurable variables drawn from institutional sources such as ISTAT and the Bank of Italy. It quantifies the lag experienced by younger generations in accessing employment, housing, credit, education, and other essential domains of human capital. The province of Latina was the first territorial context in which the index was experimentally applied, revealing levels of generational inequality above the national average.

Measuring the generational divide in Italy

Taxonomy of the Generational Divide Index. 14 domains and 43 sub-indicators measuring the inequalities experienced by the young population (14-35 years) compared to previous generations.

The main tool for measuring the generational divide in Italy is the Generational Divide Index (GDI), developed in 2015 by the Fondazione per la Ricerca Economica e Sociale ETS (formerly Fondazione Bruno Visentini).

The set of the 14 indicators of the GDI and the GDI Index from 2006 to 2022 - The summary index shows how inequalities between generations have changed over the period, with a focus on the effects of economic and social crises.

The GDI is a composite indicator designed to detect the obstacles that hinder young generations from achieving full economic and social maturity. Over the years, the index has been progressively refined, with an expansion in both the domains and sub-indicators considered. In its most recent version (GDI 4.0), it includes 14 domains—such as labor market, housing, pensions, public debt, democratic participation, health, human capital, innovation, rule of law, environment, and gender equality—and a total of 43 annually measurable indicators based on official statistical sources, covering the period from 2006 to 2023.

The index, as developed by the Fondazione per la Ricerca Economica e Sociale ETS, illustrates the trend of the Generational Divide in Italy (GDI Index) from 2006 to 2022, using 2006 as the base year (index value = 100).

GDI 4.0. Classification of the Index domains according to the four impact areas defined by the COVIGE guidelines (Welfare, Education, Inclusion and Work).

An increase in the GDI indicates a worsening situation for younger generations, meaning a widening of the generational divide, whereas a decrease in the index reflects a reduction in the obstacles hindering young people's achievement of personal and professional autonomy.