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Voting on public pensions with hands and feet

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  • Alexander Haupt
  • Wolfgang Peters

Abstract

Aging changes the political power in a democracy in favor of the older generations. With free labor mobility like that of the EU, the success of the gerontocracy is, nevertheless, limited by migration of the young generations. This connection between political voting and voting with the feet is analyzed in a two-country model with overlapping generations. The interregional competition on public pensions yields premium payments which are larger when the young generations' migration decisions take the impact on future pensions into account (strategic migration) than when these decisions are made myopically. The paper also pays attention to migration (in-)efficiency and to the implications of harmonization principles. Copyright Springer-Verlag Berlin Heidelberg 2003

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File URL: http://hdl.handle.net/10.1007/s101010100043
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Bibliographic Info

Article provided by Springer in its journal Economics of Governance.

Volume (Year): 4 (2003)
Issue (Month): 1 (04)
Pages: 57-80

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Handle: RePEc:spr:ecogov:v:4:y:2003:i:1:p:57-80

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Related research

Keywords: Key words: Interregional competition on public pensions; migration; labor mobility; gerontocracy; JEL Classification Numbers: D72; F22; H55;

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Cited by:
  1. Börner, Kira & Uebelmesser, Silke, 2005. "Migration and the Welfare State: The Economic Power of the Non-Voter?," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 154, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
  2. Anna Montén & Marcel Thum, 2008. "Ageing Municipalities, Gerontocracy and Fiscal Competition," CESifo Working Paper Series 2469, CESifo Group Munich.
  3. Haupt, Alexander & Peters, Wolfgang, 2005. "Restricting preferential tax regimes to avoid harmful tax competition," Regional Science and Urban Economics, Elsevier, vol. 35(5), pages 493-507, September.
  4. Alexander Haupt & Eckhard Janeba, 2003. "Bildung im Zeitalter mobilen Humankapitals," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 72(2), pages 173-187.
  5. Tim Krieger & Thomas Lange, 2010. "Education policy and tax competition with imperfect student and labor mobility," International Tax and Public Finance, Springer, vol. 17(6), pages 587-606, December.

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