IDEAS home Printed from https://ideas.repec.org/a/oup/cesifo/v60y2014i1p246-256..html
   My bibliography  Save this article

Coordination of Pension Systems When Technologies are Different

Author

Listed:
  • Igor Fedotenkov

Abstract

This article presents a simple condition for optimal coordination of social security policies in the union of two open economies employing different production functions and within which capital and labour are fully mobile. We find that if both countries run fully funded pension schemes, the allocation of mobile production factors may not be optimal when the countries have different technologies. To remove this distortion, at least one country must run a pay-as-you-go pension scheme. Policy coordination which takes technological differences into account allows for the removal of static inefficiencies, maximizing the welfare of the agents in the steady state. (JEL codes: F22, F42, H55)

Suggested Citation

  • Igor Fedotenkov, 2014. "Coordination of Pension Systems When Technologies are Different," CESifo Economic Studies, CESifo Group, vol. 60(1), pages 246-256.
    • Handle: RePEc:oup:cesifo:v:60:y:2014:i:1:p:246-256.
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1093/cesifo/ifu004
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Marko Köthenbürger & Panu Poutvaara, 2006. "Social Security Reform and Investment in Education: Is There Scope for a Pareto Improvement?," Economica, London School of Economics and Political Science, vol. 73(290), pages 299-319, May.
    2. Poutvaara, Panu, 2007. "Social security incentives, human capital investment and mobility of labor," Journal of Public Economics, Elsevier, vol. 91(7-8), pages 1299-1325, August.
    3. Homburg, Stefan, 1990. "The Efficiency of Unfunded Pension Schemes," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 146, pages 640-647.
    4. Igor Fedotenkov & Lex Meijdam, 2014. "Pension reform with migration and mobile capital: is a Pareto improvement possible?," International Economics and Economic Policy, Springer, vol. 11(3), pages 431-450, September.
    5. Gerking, Shelby D. & Mutti, John H., 1983. "Factor rewards and the international migration of unskilled labor: A model with capital mobility," Journal of International Economics, Elsevier, vol. 14(3-4), pages 367-380, May.
    6. Aburaihan Intezar & Mohammad Ibrahim Sharaf & Abdul Malik Hakeemi, 2019. "The reasons of reduced carpet production in Afghanistan: A case study of Aqcha district," International Journal of Innovative Research and Scientific Studies, Innovative Research Publishing, vol. 2(4), pages 62-66.
    7. Breyer, Friedrich & Kolmar, Martin, 2002. "Are national pension systems efficient if labor is (im)perfectly mobile?," Journal of Public Economics, Elsevier, vol. 83(3), pages 347-374, March.
    8. Maddison, Angus, 1987. "Growth and Slowdown in Advanced Capitalist Economies: Techniques of Quantitative Assessment," Journal of Economic Literature, American Economic Association, vol. 25(2), pages 649-698, June.
    9. Stefan Homburg & Wolfram Richter, 1993. "Harmonizing public debt and public pension schemes in the European community," Journal of Economics, Springer, vol. 7(1), pages 51-63, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Igor Fedotenkov & Lex Meijdam, 2014. "Pension reform with migration and mobile capital: is a Pareto improvement possible?," International Economics and Economic Policy, Springer, vol. 11(3), pages 431-450, September.
    2. Fedotenkov, I., 2012. "Pensions and ageing in a globalizing world. International spillover effects via trade and factor mobility," Other publications TiSEM 8830bc21-4138-4479-8459-a, Tilburg University, School of Economics and Management.
    3. Krieger, Tim, 2005. "Renten und Zuwanderung: Ein Überblick über neue Ergebnisse der Forschung," Arbeitspapiere der Nordakademie 2005-04, Nordakademie - Hochschule der Wirtschaft.
    4. Tim Krieger, 2014. "Public Pensions and Immigration," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 12(2), pages 10-15, 07.
    5. Tim Krieger, 2014. "Public Pensions and Immigration," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 12(02), pages 10-15, July.
    6. Yvonne Adema & Lex Meijdam & Harrie Verbon, 2009. "The international spillover effects of pension reform," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 16(5), pages 670-696, October.
    7. Helmuth Cremer & Catarina Goulão, 2014. "Migration and Social Insurance," Recherches économiques de Louvain, De Boeck Université, vol. 80(1), pages 5-29.
    8. repec:ces:ifodic:v:12:y:2014:i:2:p:19116205 is not listed on IDEAS
    9. Kolmar, Martin, 2007. "Beveridge versus Bismarck public-pension systems in integrated markets," Regional Science and Urban Economics, Elsevier, vol. 37(6), pages 649-669, November.
    10. Gabrielle Demange, 2005. "Free choice of unfunded systems: a first assessment," PSE Working Papers halshs-00590861, HAL.
    11. Poutvaara, Panu, 2007. "Social security incentives, human capital investment and mobility of labor," Journal of Public Economics, Elsevier, vol. 91(7-8), pages 1299-1325, August.
    12. Wrede, Matthias, 1998. "Pareto efficiency of the pay-as-you-go pension system in a three-period-OLG model," BERG Working Paper Series 27, Bamberg University, Bamberg Economic Research Group.
    13. Homburg, Stefan, 1997. "Old-age Pension Systems: A Theoretical Evaluation," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, pages 233-246.
    14. Silke Uebelmesser, 2004. "Harmonisation of Old-age Security Within the European Union," CESifo Economic Studies, CESifo, vol. 50(4), pages 717-743.
    15. Cremer, Helmuth & Pestieau, Pierre, 2002. "Factor Mobility and Redistribution: A Survey," IDEI Working Papers 154, Institut d'Économie Industrielle (IDEI), Toulouse, revised 2003.
    16. Gouveia, Ana, 2010. "The political economy of pension systems under free labor mobility," MPRA Paper 77287, University Library of Munich, Germany.
    17. Tim Krieger, 2002. "Intergenerational Redistribution and Labor Mobility: A Survey," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 58(3), pages 339-361, July.
    18. Pierre Pestieau & Gwanaël Piaser & Motohiro Sato, 2006. "PAYG pension systems with capital mobility," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 13(5), pages 587-599, September.
    19. Kolmar, Martin, 1999. "Optimale Ansiedlung sozialpolitischer Entscheidungskompetenzen in der Europäischen Union," Beiträge zur Finanzwissenschaft, Mohr Siebeck, Tübingen, edition 1, volume 7, number urn:isbn:9783161471254, December.
    20. Demange, Gabrielle, 2008. "Competition between Unfunded Systems: A European Union challenge," CEPREMAP Working Papers (Docweb) 0808, CEPREMAP.
    21. Fenge, Robert & Von Weizsäcker, Jakob, 2010. "Public pension systems and distortions of intra-EU mobility: the Lodge Test," Journal of Pension Economics and Finance, Cambridge University Press, vol. 9(2), pages 263-275, April.

    More about this item

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • F42 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Policy Coordination and Transmission
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:cesifo:v:60:y:2014:i:1:p:246-256.. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press (email available below). General contact details of provider: https://edirc.repec.org/data/cesifde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.