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Pension reform, employment by age, and long-run growth

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  • Tim Buyse

    ()

  • Freddy Heylen
  • Renaat Van de Kerckhove

Abstract

We study the effects of pension reform on hours worked by three active generations, education of the young, the retirement decision of older workers, and aggregate growth in a four-period OLG model. The model explains important facts well for many OECD countries. Our simulation results prefer an intelligent pay-as-you-go system above a fully funded private system. Positive effects on employment and growth are the strongest when the pay-as-you-go system includes a tight link between individual labor income and the pension, and when it attaches a high weight to labor income earned as an older worker to compute the pension assessment base. Copyright Springer-Verlag 2013

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Bibliographic Info

Article provided by Springer in its journal Journal of Population Economics.

Volume (Year): 26 (2013)
Issue (Month): 2 (April)
Pages: 769-809

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Handle: RePEc:spr:jopoec:v:26:y:2013:i:2:p:769-809

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Related research

Keywords: Retirement; Pension reform; Overlapping generations; E62; H55; J22;

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Citations

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Cited by:
  1. Edgar Vogel & Alexander Ludwig & Axel Börsch-Supan, 2013. "Aging and Pension Reform: Extending the Retirement Age and Human Capital Formation," Working Paper Series in Economics 59, University of Cologne, Department of Economics.
  2. T. Buyse & F. Heylen, 2012. "Leaving the empirical (battle)ground: Output and welfare effects of fiscal consolidation in general equilibrium," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 12/826, Ghent University, Faculty of Economics and Business Administration.
  3. T. Buyse & F. Heylen & R. Van De Kerckhove, 2012. "Pension reform in an OLG model with heterogeneous abilities," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 12/810, Ghent University, Faculty of Economics and Business Administration.
  4. Heylen Freddy & Van de Kerckhove Renaat, 2013. "Employment by age, education, and economic growth: effects of fiscal policy composition in general equilibrium," The B.E. Journal of Macroeconomics, De Gruyter, vol. 13(1), pages 55, October.

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