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Increasing longevity and social security reforms--A legislative procedure approach

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  • Andersen, Torben M.

Abstract

Increasing longevity causes an upward trend in the dependency ratio in many countries. This raises concerns about the financial sustainability of social security schemes, and reform proposals and initiatives abound. It is shown that a fundamental policy choice inevitably arises since a given social security system cannot be maintained by simply indexing pension ages to longevity. The political reform process is analysed using the so-called legislative procedure. When longevity increases, the retirement age is raised more than proportionally to the increase in longevity, but the young also make larger transfers to the old.

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  • Andersen, Torben M., 2008. "Increasing longevity and social security reforms--A legislative procedure approach," Journal of Public Economics, Elsevier, vol. 92(3-4), pages 633-646, April.
  • Handle: RePEc:eee:pubeco:v:92:y:2008:i:3-4:p:633-646
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    1. repec:gam:jsusta:v:8:y:2016:i:1:p:46:d:62136 is not listed on IDEAS
    2. Torben Andersen, 2014. "Intergenerational redistribution and risk sharing with changing longevity," Journal of Economics, Springer, vol. 111(1), pages 1-27, February.
    3. Torben Andersen & Mikkel Hermansen, 2014. "Durable consumption, saving and retirement," Journal of Population Economics, Springer;European Society for Population Economics, vol. 27(3), pages 825-840, July.
    4. Giam Pietro Cipriani & Miltiadis Makris, 2012. "Payg Pensions And Human Capital Accumulation: Some Unpleasant Arithmetic," Manchester School, University of Manchester, vol. 80(4), pages 429-446, July.
    5. Andersen, Torben M, 2008. "Fiscal Sustainability and Demographics - Should We Save or Work More?," CEPR Discussion Papers 7044, C.E.P.R. Discussion Papers.
    6. Yuehong Tian & Xianglian Zhao, 2016. "Stochastic Forecast of the Financial Sustainability of Basic Pension in China," Sustainability, MDPI, Open Access Journal, vol. 8(1), pages 1-17, January.
    7. Andersen, Torben M., 2012. "Fiscal sustainability and demographics – Should we save or work more?," Journal of Macroeconomics, Elsevier, vol. 34(2), pages 264-280.
    8. Demirguc-Kunt,Asli & Klapper,Leora & Panos,Georgios A., 2016. "Saving for old age," Policy Research Working Paper Series 7693, The World Bank.

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