Privatizing Social Security in the U.S. -- Comparing the Options
This paper uses a new version of the Auerbach-Kotlikoff model to consider alternative ways to privatize the U.S. Social Security system. The new model incorporates intra- and intergenerational heterogeneity and is closely calibrated to U.S. fiscal institutions. Three privatization issues are considered: financing the transition, participation rules, and progressivity. As shown, Social Security's privatization can substantially raise long-run living standards. But these gains come at the cost of welfare losses to transition generations and take a long time to materialize. The long-run poor have much to gain from privatization even absent an explicit redistribution mechanism. Finally, privatizations that give initial workers the option of remaining in the current system have particularly low transition costs and particularly favorable macroeconomic consequences. (Copyright: Elsevier)
Volume (Year): 2 (1999)
Issue (Month): 3 (July)
|Contact details of provider:|| Postal: Marina Azzimonti, Department of Economics, Stonybrook University, 10 Nicolls Road, Stonybrook NY 11790 USA|
Web page: http://www.EconomicDynamics.org/red/
More information through EDIRC
|Order Information:|| Web: https://www.economicdynamics.org/subscription-information/ Email: |
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Imrohoroglu, Ayse & Imrohoroglu, Selahattin & Joines, Douglas H, 1995. "A Life Cycle Analysis of Social Security," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 6(1), pages 83-114, June.
- Laurence J. Kotlikoff & Kent A. Smetters & Jan Walliser, 1998.
"Social Security: Privatization and Progressivity,"
NBER Working Papers
6428, National Bureau of Economic Research, Inc.
- Samwick, Andrew A., 1998.
"Discount rate heterogeneity and social security reform,"
Journal of Development Economics,
Elsevier, vol. 57(1), pages 117-146, October.
- Andrew A. Samwick, 1997. "Discount Rate Heterogeneity and Social Security Reform," NBER Working Papers 6219, National Bureau of Economic Research, Inc.
- Alan L. Gustman & Thomas L. Steinmeier, 1998.
"Privatizing Social Security: First-Round Effects of a Generic, Voluntary, Privatized U.S. Social Security System,"
in: Privatizing Social Security, pages 313-361
National Bureau of Economic Research, Inc.
- Alan L. Gustman & Thomas L. Steinmeier, 1995. "Privatizing Social Security: First Round Effects of a Generic, VoluntaryPrivatized U.S. Social Security System," NBER Working Papers 5362, National Bureau of Economic Research, Inc.
- Davis, Steven J & Henrekson, Magnus, 1999.
"Explaining National Differences in the Size and Industry Distribution of Employment,"
Small Business Economics,
Springer, vol. 12(1), pages 59-83, February.
- Steven J. Davis & Magnus Henrekson, 1997. "Explaining National Differences in the Size and Industry Distribution of Employment," NBER Working Papers 6246, National Bureau of Economic Research, Inc.
- Martin Feldstein, 1997. "Transition to a Fully Funded Pension System: Five Economic Issues," NBER Working Papers 6149, National Bureau of Economic Research, Inc.
When requesting a correction, please mention this item's handle: RePEc:red:issued:v:2:y:1999:i:3:p:532-574. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christian Zimmermann)
If references are entirely missing, you can add them using this form.