The Crisis of Germany's Pension Insurance system and How it Can be Resolved
AbstractThe paper discusses the options for a reform of the German pension system using a model developed at CES for the German Council of economic advisors to the Federal Ministry of Economics and Research. It is argued that the German pay-as-you-go-system is efficient in a present value sense but will nevertheless need the support of a funded system to avoid a financial crisis. The paper recommends obligatory priv ate savings at a variable rate where the time path of the savings rate is chosen so as to stabilize the sum of this rate and the pay-as-you-go contribution rate, given the time path of pensions as defined in the present system.
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Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 191.
Date of creation: 1999
Date of revision:
Pension insurance; pay-as-you-go system; savings; Germany;
Other versions of this item:
- Hans-Werner Sinn, 1999. "The Crisis of Germany's Pension Insurance System and How It Can Be Resolved," NBER Working Papers 7304, National Bureau of Economic Research, Inc.
- Sinn, Hans-Werner, 1999. "The Crisis of Germany's Pension Insurance System and How It Can Be Resolved," CEPR Discussion Papers 2175, C.E.P.R. Discussion Papers.
- H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
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