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Das Umlageverfahren: Idee und Wirklichkeit

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  • Helmedag Fritz

Abstract

The formal relationships between the contribution rate of workers and the pension level are modelled in the pay-as-you-go system. The average pensioner has paid contributions over 36 years and currently receives EUR 1,246.67 as a monthly pension. The “standard pensioner” contributed over 45 years and receives a “standard pension” of EUR 1,692. The real pension level is 42.6% and thus falls short of the 48% target level. In the pay-as-you-go system, the monthly pension would only amount to EUR 1,203.66. Higher contributions reduce average wages relatively less than they increase the pension benefits. A redistribution within the pool of insured people should compensate for the shorter payment periods of below-average pensions.

Suggested Citation

  • Helmedag Fritz, 2024. "Das Umlageverfahren: Idee und Wirklichkeit," Wirtschaftsdienst, Sciendo, vol. 104(2), pages 92-97, February.
    • Handle: RePEc:vrs:wirtsc:v:104:y:2024:i:2:p:92-97:n:10
    DOI: 10.2478/wd-2024-0030
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    More about this item

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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