Benefit-Cost Analysis of Turkish Social Insurance Institute Gradual Privatization Proposal
There has been consideration of alternative social security financing methods throughout the world during the last two decades. One alternative adopted in several countries is the privatization of so-called pay-as-you-go financing systems. The purpose of this study is to estimate social benefits and social costs associated with a Feldsteinian-type gradual privatization of the Turkish Social Insurance Institute, SSK. Based heavily upon data provided by the International Labor Organization, financial projections of the institution were made and extended to apply benefit-cost models of privatization. Present values of the change in net social benefit were estimated. The effect of privatization on representative individuals has been quantified. Sensitivity analyses were conducted to determine the robustness of the estimates. Benefit-cost results indicate that social benefits associated with a privatization alternative exceed the social costs even after adjustments for changes in key parameters that reduce social net benefits. However, privatization affects current representative individuals so negatively that it may constitute a good political reason to be against, rather than in favor of, choosing privatization.
|Date of creation:||2005|
|Date of revision:|
|Publication status:||Published in Journal of Economic Cooperation 4.26(2005): pp. 87-126|
|Contact details of provider:|| Postal: |
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC
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.:
- Martin Feldstein, 1995.
"Tax Avoidance and the Deadweight Loss of the Income Tax,"
NBER Working Papers
5055, National Bureau of Economic Research, Inc.
- Martin Feldstein, 1999. "Tax Avoidance And The Deadweight Loss Of The Income Tax," The Review of Economics and Statistics, MIT Press, vol. 81(4), pages 674-680, November.
- Kenc, Turalay & Sayan, Serdar, 2001. "Demographic shock transmission from large to small countries: An overlapping generations CGE analysis," Journal of Policy Modeling, Elsevier, vol. 23(6), pages 677-702, August.
- Ahmet Tuncay Teksoz & Serdar Sayan, 2002. "Simulation of Benefits and Risks after the Planned Privatization of the Pension System in Turkey: Is the Expected Boost to Financial Markets Feasible?," Emerging Markets Finance and Trade, M.E. Sharpe, Inc., vol. 38(5), pages 23-45, October.
- Olivia S. Mitchell, 1998.
"Administrative Costs in Public and Private Retirement Systems,"
in: Privatizing Social Security, pages 403-456
National Bureau of Economic Research, Inc.
- Olivia S. Mitchell, 1996. "Administrative Costs in Public and Private Retirement Systems," NBER Working Papers 5734, National Bureau of Economic Research, Inc.
- Olivia S. Mitchell, . "Administrative Costs in Public and Private Retirement Systems," Pension Research Council Working Papers 96-4, Wharton School Pension Research Council, University of Pennsylvania.
- Feldstein, Martin S, 1974. "Social Security, Induced Retirement, and Aggregate Capital Accumulation," Journal of Political Economy, University of Chicago Press, vol. 82(5), pages 905-26, Sept./Oct.
- Feldstein, Martin, 1996.
"The Missing Piece in Policy Analysis: Social Security Reform,"
American Economic Review,
American Economic Association, vol. 86(2), pages 1-14, May.
- Martin Feldstein, 1996. "The Missing Piece in Policy Analysis: Social Security Reform," NBER Working Papers 5413, National Bureau of Economic Research, Inc.
- Serdar Sayan & Arzdar Kiraci, 2001. "Identification of parametric policy options for rehabilitating a pay-as-you-go based pension system: an optimization analysis for Turkey," Applied Economics Letters, Taylor & Francis Journals, vol. 8(2), pages 89-93.
- Attanasio, Orazio P. & Paiella, Monica, 2001. "Households savings in the U.S.A," Research in Economics, Elsevier, vol. 55(1), pages 109-132, March.
- Serdar Sayan & Turalay Kenc, 1999. "Long-term Consequences of Rehabilitating a Financially Troubled Pension System: An Analysis for Turkey," Working Papers 9914, Economic Research Forum, revised May 1999.
- Mitchell, Olivia S & Zeldes, Stephen P, 1996.
"Social Security Privatization: A Structure for Analysis,"
American Economic Review,
American Economic Association, vol. 86(2), pages 363-67, May.
- Olivia S. Mitchell & Stephen P. Zeldes, 1996. "Social Security Privatization: A Structure for Analysis," NBER Working Papers 5512, National Bureau of Economic Research, Inc.
- Sayan, Serdar & Kiraci, Arzdar, 2001. "Parametric pension reform with higher retirement ages: A computational investigation of alternatives for a pay-as-you-go-based pension system," Journal of Economic Dynamics and Control, Elsevier, vol. 25(6-7), pages 951-966, June.
- Metin Ercen & Deniz Gokce, 1998. "Defined Contribution Model: Definition, Theory and an Application for Turkey," Istanbul Stock Exchange Review, Research and Business Development Department, Borsa Istanbul, vol. 2(8-7), pages 33-51.
- von Furstenberg, George M, 1980. "Private Saving," American Economic Review, American Economic Association, vol. 70(2), pages 177-81, May.
- Meguire, Philip, 1998. "Comment: Social Security and Private Savings," National Tax Journal, National Tax Association, vol. 51(n. 2), pages 339-58, June.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:42372. 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: (Ekkehart Schlicht)
If references are entirely missing, you can add them using this form.