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Beveridge versus Bismarck public-pension systems in integrated markets

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  • Kolmar, Martin

Abstract

The two basic systems according to which pay-as-you-go-financed public-pension systems can be organized are the (Anglo-Saxon) Beveridge system and the (continental) Bismarck system. An ideal Beveridge system provides flat-rate benefits, whereas an ideal Bismarck system provides earnings-related benefits. This paper analyzes the circumstances under which a Beveridge system can be sustainable in systems competition with a Bismarck system. The analysis reveals a much more complicated redistributive structure of the pension systems than only between high and low incomes. As a consequence, the sustainability depends on growth rates, and equilibria can exist where, contrary to the first intuition, even poor individuals prefer a Bismarck and rich individuals prefer a Beveridge system.

Suggested Citation

  • Kolmar, Martin, 2007. "Beveridge versus Bismarck public-pension systems in integrated markets," Regional Science and Urban Economics, Elsevier, vol. 37(6), pages 649-669, November.
  • Handle: RePEc:eee:regeco:v:37:y:2007:i:6:p:649-669
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    References listed on IDEAS

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    Cited by:

    1. Tim Krieger, 2014. "Public Pensions and Immigration," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 12(2), pages 10-15, 07.
    2. Tim Krieger & Thomas Lange, 2012. "Education, Life Expectancy and Pension Reform," Hacienda Pública Española, IEF, vol. 202(3), pages 31-55, September.
    3. Helmuth Cremer & Catarina Goulão, 2014. "Migration and Social Insurance," Recherches économiques de Louvain, De Boeck Université, vol. 80(1), pages 5-29.
    4. Ania, Ana B. & Wagener, Andreas, 2009. "The Open Method of Coordination (OMC) as an Evolutionary Learning Process," Hannover Economic Papers (HEP) dp-416, Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät.
    5. Stefan Traub & Tim Krieger, 2009. "Wie hat sich die intragenerationale Umverteilung in der staatlichen Säule des Rentensystems verändert? Ein internationaler Vergleich auf Basis von LIS-Daten," LIS Working papers 520, LIS Cross-National Data Center in Luxembourg.
    6. Anja Hülsewig, 2008. "Bismarck versus Beveridge: Ein Vergleich von Sozialversicherungssystemen in Europa," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 61(21), pages 26-29, November.
    7. Maciej Lis, 2017. "Productivity based selection to retirement: Evidence from EU-SILC," IBS Working Papers 02/2017, Instytut Badan Strukturalnych.
    8. Gouveia, Ana, 2010. "The political economy of pension systems under free labor mobility," MPRA Paper 77287, University Library of Munich, Germany.
    9. Santacruz Cano, Javier & Bernal Alonso, Miguel Ángel, 2015. "Efficiency in Pension Funds Management in a QE Environment: The Case of Spain/Eficiencia en la gestión de los fondos de pensiones en un entorno de QE: El caso de España," Estudios de Economía Aplicada, Estudios de Economía Aplicada, vol. 33, pages 687-700, Septiembr.
    10. Tim Krieger & Stefan Traub, 2009. "Wie hat sich die intragenerationale Umverteilung in der staatlichen Säule des Rentensystems verändert? Ein internationaler Vergleich auf Basis von LIS-Daten," Working Papers CIE 24, Paderborn University, CIE Center for International Economics.
    11. repec:ces:ifodic:v:12:y:2014:i:2:p:19116205 is not listed on IDEAS
    12. Igor Fedotenkov & Lex Meijdam, 2014. "Pension reform with migration and mobile capital: is a Pareto improvement possible?," International Economics and Economic Policy, Springer, vol. 11(3), pages 431-450, September.
    13. Fedotenkov, I., 2012. "Pensions and ageing in a globalizing world. International spillover effects via trade and factor mobility," Other publications TiSEM 8830bc21-4138-4479-8459-a, Tilburg University, School of Economics and Management.

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