Pension reform sustainability in the EU: a pension wealth-based framework
AbstractMost assessments of pension sustainability focus on the projected fall in spending. However interest in the impact on adequacy, usually measured by replacement rates, is increasing. In this paper we show that replacement rates have significant defects, related to being point-in-time indicators and the use of unrepresentative assumptions. We argue for the use of pension wealth calculated using more realistic assumptions. Looking at ten EU countries, we find that while generosity decreased significantly, systems’ effectiveness in alleviating poverty remain strong in countries where minimum pensions were improved. However, moves to link benefits to contributions have raised concerns for women and for those on low incomes. Though reforms have reduced the fiscal challenge of ageing, in many countries pressures will persist and further reforms are likely.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 48800.
Date of creation: Apr 2013
Date of revision:
Social Security and Public Pensions; Retirement; Poverty; Retirement Policies.;
Find related papers by JEL classification:
- H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
- I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
- J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
This paper has been announced in the following NEP Reports:
- NEP-AGE-2013-08-10 (Economics of Ageing)
- NEP-ALL-2013-08-10 (All new papers)
- NEP-DEM-2013-08-10 (Demographic Economics)
- NEP-PBE-2013-08-10 (Public Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Ondrej Schneider, 2009.
"Reforming Pensions in Europe: Economic Fundamentals and Political Factors,"
CESifo Working Paper Series
2572, CESifo Group Munich.
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- Ondřej Schneider, 2009. "Reforming Pensions in Europe: Economic Fundamentals and Political Factors," Working Papers IES 2009/08, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Feb 2009.
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- Robert Holzmann & Richard Hinz, 2005. "Old Age Income Support in the 21st century: An International Perspective on Pension Systems and Reform," World Bank Publications, The World Bank, number 7336, March.
- Grech, Aaron George, 2007. "Pension policy in EU25 and its impact on pension benefits," MPRA Paper 33669, University Library of Munich, Germany.
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