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Budgetary Impact of Social Security Privatization: Women Doubly Unprotected

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  • Eugenia Correa

Abstract

In several developing economies during the 1990s there was a fundamental financial reform of pension systems. This article analyzes the main results of these reforms through a gender approach. Seen as a social reform, pension reforms have maintained a growing uninsured population, with women experiencing relatively greater workplace precariousness and, at the same time, longer lives. The article also centers on fiscal implications, and particularly the transition from a pure public pay-as-you-go pension system that was self-funded and sustainable, to a system in which contributions went to private pension funds, creating a funding gap, which is being filled by the public budget in several current pension schemes. As a financial reform, it has also had several interesting results. Although the private system did not increase coverage and the projected flows, it did produce a constant flow of mandatory and accumulated savings that provide liquidity to domestic financial markets and even external markets. However, this liquidity has not been a factor in increasing the flows of credit to the nonfinancial domestic private sector. Under the conditions of austerity policies, budget cuts in other components of social spending, such as education and especially health care, leave women doubly unprotected.

Suggested Citation

  • Eugenia Correa, 2015. "Budgetary Impact of Social Security Privatization: Women Doubly Unprotected," International Journal of Political Economy, Taylor & Francis Journals, vol. 44(4), pages 260-276, October.
    • Handle: RePEc:mes:ijpoec:v:44:y:2015:i:4:p:260-276
    DOI: 10.1080/08911916.2015.1129839
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    References listed on IDEAS

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    1. Julie A. Nelson, 2012. "Poisoning the Well, or How Economic Theory Damages Moral Imagination," GDAE Working Papers 12-07, GDAE, Tufts University.
    2. Dubravko Mihaljek, 2006. "Privatisation, consolidation and the increased role of foreign banks," BIS Papers chapters, in: Bank for International Settlements (ed.), The banking system in emerging economies: how much progress has been made?, volume 28, pages 41-65, Bank for International Settlements.
    3. Edwards, Sebastian & Edwards, Alejandra Cox, 2002. "Social Security Privatization and Labor Markets: The Case of Chile," Economic Development and Cultural Change, University of Chicago Press, vol. 50(3), pages 465-489, April.
    4. repec:ecr:col040:5898 is not listed on IDEAS
    5. Sebastian Edwards & Alejandra Cox Edwards, 2002. "Social Security Privatization Reform and Labor Markets: The Case of Chile," NBER Working Papers 8924, National Bureau of Economic Research, Inc.
    6. Nelson, Julie A., 2012. "Poisoning the Well, or How Economic Theory Damages Moral Imagination," Working Papers 179107, Tufts University, Global Development and Environment Institute.
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