The international spillover effects of pension reform
October 2009
Article
volume 16, issue 5 pp 670-696.
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This paper explores how pension reforms in countries with PAYG schemes affect countries with funded systems. We use a two-country two-period overlapping-generations model, where the countries only differ in their pension systems. We distinguish between the case where a reform potentially leads to a Pareto improvement in the PAYG country, and where this is impossible. In the latter case, the funded country shares both in the costs and the benefits of the reform. However, if a Pareto-improving pension reform is feasible in the PAYG country, a Pareto improvement in the funded country is not guaranteed.
Keywords
Classifications using
Journal of Economic Literature (JEL) Classification System
- F47 : Forecasting and Simulation
- F41 : Open Economy Macroeconomics
- H63 : Debt; Debt Management
- H55 : Social Security and Public Pensions
- F21 : International Investment; Long-Term Capital Movements
Automatically Extracted Terms
- country
- reform
- pension
- effect
- capitallabor ratio
- pension reform
- spillover effects
- payg country
- system
- result
- capital
- change
- ratio
- generation
- country p
- capitallabor
- payg system
- government
- consumption
- spillover
