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Demographic pressures and the sustainability of social security in Emerging Europe and Central Asia

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  • Jaromir Cekota

    ()
    (United Nations Economic Commission for Europe)

  • Claudia Trentini

    ()
    (United Nations Economic Commission for Europe)

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    Abstract

    This paper investigates the long-term effects of population ageing in a number of ECE emerging market economies. The latest revision of the UN World Population Prospects implies that all of the countries of Eastern Europe, Caucasus and Central Asia (EECCA) and South-Eastern Europe (SEE) will experience population ageing over the period 2010-2050. In most of them, the ageing process will be associated with rising dependency ratios as the share of the working-age groups in the total population shrinks. In these economies, the combination of an ageing and declining population is likely to reduce the effective labor supply, threatening to undermine the sustainability of their public pension and health systems. The analysis of available demographic and economic data confirms the severity of the demographic crisis' consequences for fiscal sustainability. Further, the results provide compelling evidence on the necessity for most of the countries in the region to undergo wide reaching policy reforms with a particular focus on pension systems and labor markets. Ageing is one of the significant cost factors, but not the only one, that will impact health spending in SEE and EECCA countries. The public health sector needs to be reformed with a view to increasing its efficiency.

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    File URL: http://www.unece.org/fileadmin/DAM/oes/disc_papers/ECE_DP_2012-2.pdf
    File Function: First version, 2012
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    Bibliographic Info

    Paper provided by UNECE in its series ECE Discussion Papers Series with number 2012_2.

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    Length: 30 pages
    Date of creation: Jul 2012
    Date of revision:
    Publication status: Published in United Nations ECE Discussion Paper Series, No. 2012_2
    Handle: RePEc:ece:dispap:2012_2

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    Keywords: aeging; social security; health; welfare; labor force; transition;

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    References

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    1. Robert Shelburne & Claudia Trentini, 2009. "Public Health in Europe: The 2007-2009 Financial Crisis and UNECE Activities," ECE Discussion Papers Series 2009_2, UNECE.
    2. Katerina Lisenkova, 2011. "Pension reform in a rapidly ageing country: the case of Ukraine," Working Papers 1126, University of Strathclyde Business School, Department of Economics.
    3. World Bank, 2009. "Pensions in Crisis : Europe and Central Asia Regional Policy Note," World Bank Other Operational Studies 18728, The World Bank.
    4. Alexander Chubrik & Roman Mogilevsky & Irina Sinitsina & Marek Dabrowski, 2011. "The Impact of the Global Financial Crisis on Public Expenditures on Education and Health in the Economies of the Former Soviet Union," CASE Network Reports 0100, CASE-Center for Social and Economic Research.
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