Demographic change, endogenous labor supply and the political feasibility of pension reform
Options for reforming unfunded public pension schemes that are now being discussed all share the feature that the burden induced by demographic change would be shifted towards presently living and away from unborn generations. Existing models of the political economy of pension reform can not explain why such reform options are being discussed at all. We present an alternative model in which the possibility of evasion of workers from payment of social security taxes is taken into account by modelling a labor supply function. It turns out that the burden of demographic change may fall completely or at least predominantly on the pensioners. Thus this type of model can much better explain recent trends in legislature on unfunded public pension systems in industrial democracies.
Volume (Year): 14 (2001)
Issue (Month): 3 ()
|Note:||Received: 7 January 1999/Accepted: 20 December 1999|
|Contact details of provider:|| Web page: http://www.springer.com|
More information through EDIRC
|Order Information:||Web: http://www.springer.com/economics/population/journal/148/PS2|
References listed on IDEAS
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.:
- Friedrich Breyer & Ben R. Craig, 1995.
"Voting on social security: evidence from OECD countries,"
9511, Federal Reserve Bank of Cleveland.
- Breyer, Friedrich & Craig, Ben, 1997. "Voting on social security: Evidence from OECD countries," European Journal of Political Economy, Elsevier, vol. 13(4), pages 705-724, December.
- Harrie Verbon & Marijn Verhoeven, 1992. "Decision making on pension schemes under rational expectations," Journal of Economics, Springer, vol. 56(1), pages 71-97, February.
- Meijdam, Lex & Verbon, Harrie A A, 1996.
"Aging and Political Decision Making on Public Pensions,"
Journal of Population Economics,
Springer;European Society for Population Economics, vol. 9(2), pages 141-58, May.
- Lex Meijdam & Harrie Verbon, 1996. "Aging and political decision making on public pensions," Journal of Population Economics, Springer;European Society for Population Economics, vol. 9(2), pages 141-158, June.
- Meijdam, A.C. & Verbon, H.A.A., 1996. "Aging and political decision making on public pensions," Other publications TiSEM 30434a77-0d7a-4d11-8fbd-3, Tilburg University, School of Economics and Management.
- Breyer, Friedrich, 1994. "The political economy of intergenerational redistribution," European Journal of Political Economy, Elsevier, vol. 10(1), pages 61-84, May.
- Meltzer, Allan H & Richard, Scott F, 1981. "A Rational Theory of the Size of Government," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 914-27, October.
- Browning, Edgar K, 1975. "Why the Social Insurance Budget Is Too Large in a Democracy," Economic Inquiry, Western Economic Association International, vol. 13(3), pages 373-88, September.
When requesting a correction, please mention this item's handle: RePEc:spr:jopoec:v:14:y:2001:i:3:p:409-424. 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: (Sonal Shukla)or (Rebekah McClure)
If references are entirely missing, you can add them using this form.