Social Security systems in Latin America prior to the reforms exhibited some problems that have been reported also in other parts of the world, including OECD countries. This is the case for instance of the increasing pressure that the pension system put on fiscal accounts. Other problems that are frequent in the region do not seem to be present in developed countries. Large evasion, low coverage, informality, lack of transparency and unclear rules of the game are problems usually quoted in reports and studies about Latin American countries and are not mentioned for OECD countries. This essay presents some preliminary results of a research program aimed at determining the nature of these problems, gathering empirical evidence, proposing some explanatory hypotheses and analyzing the implications for the design of reforms. One of the main hypotheses analyzed in this paper is that the Social Security systems in the region were managed in a clientelistic logic favored by the lack of transparency and discretionality of the administrations. On the normative side, it is hypothesized that recent reforms in Latin America reduced the scope for clientelistic behavior in Social Security.
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Find related papers by JEL classification: E69 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Other H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
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