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Are social security programs progressive?

Author

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  • Alvaro Forteza

    (Universidad de la República Uruguay)

Abstract

Social security programs generally seek to provide insurance and to reduce poverty and inequality. Providing insurance requires little redistribution. But reducing inequality and alleviating poverty do require redistribution. To reduce inequality, programs must redistribute income, but redistributing income is not the same as reducing inequality. While some programs redistribute large amounts of income without noticeably reducing inequality, others reduce inequality with less redistribution and fewer labor market distortions. A non-contributory tier, which provides benefits without requiring contributions, is a key component for reducing inequality.

Suggested Citation

  • Alvaro Forteza, 2015. "Are social security programs progressive?," IZA World of Labor, Institute of Labor Economics (IZA), pages 172-172, July.
    • Handle: RePEc:iza:izawol:journl:y:2015:n:172
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    References listed on IDEAS

    as
    1. Gustman, Alan L. & Steinmeier, Thomas L., 2001. "How effective is redistribution under the social security benefit formula?," Journal of Public Economics, Elsevier, vol. 82(1), pages 1-28, October.
    2. Alvaro Foteza & Ignacio Apella & Eduardo Fajnzylber & Carlos Grushka & Ianina Rossi & Graciela Sanromán, 2011. "Contributions to social security in Argentina, Chile and Uruguay: Densities, transitions and duration," Económica, Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata, vol. 0, pages 127-163, January-D.
    3. Robert Holzmann & David A. Robalino & Noriyuki Takayama, 2009. "Closing the Coverage Gap : The Role of Social Pensions and Other Retirement Income Transfers," World Bank Publications - Books, The World Bank Group, number 2651.
    4. Robert Holzmann & Richard Hinz, 2005. "Old Age Income Support in the 21st century: An International Perspective on Pension Systems and Reform," World Bank Publications - Books, The World Bank Group, number 7336.
    5. Forteza, Alvaro & Ourens, Guzmán, 2012. "Redistribution, insurance and incentives to work in Latin-American pension programs," Journal of Pension Economics and Finance, Cambridge University Press, vol. 11(3), pages 337-364, July.
    6. Alvaro Forteza & Irene Mussio, 2012. "Assessing Redistribution in the Uruguayan Social Security System," Journal of Income Distribution, Ad libros publications inc., vol. 21(1), pages 65-87, March.
    7. Alvaro Forteza, 2011. "Assessing Redistribution within Social Insurance Systems.The cases of Argentina, Brazil, Chile, Mexico and Uruguay," Documentos de Trabajo (working papers) 1311, Department of Economics - dECON.
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    Cited by:

    1. Palacios, Robert & Robalino, David A., 2020. "Integrating Social Insurance and Social Assistance Programs for the Future World of Labor," IZA Discussion Papers 13258, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    social security; inequality; redistribution;
    All these keywords.

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies

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