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International Welfare Spillovers of National Pension Schemes

Author

Listed:
  • James Staveley-O'Carroll

    (Babson College)

  • Olena Staveley-O'Carroll

    (College of the Holy Cross)

Abstract

We employ a two-country overlapping-generations model to explore the international dimension of household portfolio choices induced by the asymmetric provision of government-run pensions. We study the resulting patterns of risk-sharing and the corresponding welfare effects on both home and foreign agents. Introducing the de?fined benefi?ts pay-as-you-go system at home increases the welfare of all other agents at the expense of the home workers and improves the degree of intergenerational risk sharing abroad. Conversely, a defi?ned contributions system leads to welfare losses of both home cohorts accompanied by gains abroad, but does increase the extent of intergenerational risk sharing at home.

Suggested Citation

  • James Staveley-O'Carroll & Olena Staveley-O'Carroll, 2019. "International Welfare Spillovers of National Pension Schemes," Working Papers 1903, College of the Holy Cross, Department of Economics.
  • Handle: RePEc:hcx:wpaper:1903
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    File URL: http://web.holycross.edu/RePEc/hcx/HC1903-Pensions-StavleyOCarroll.pdf
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    1. International Welfare Spillovers of National Pension Schemes
      by Christian Zimmermann in NEP-DGE blog on 2019-08-24 02:56:45

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    More about this item

    Keywords

    welfare; pay-as-you-go system; international portfolio choice; OLG model;
    All these keywords.

    JEL classification:

    • D52 - Microeconomics - - General Equilibrium and Disequilibrium - - - Incomplete Markets
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions

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