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Social Security Reforms in Northern Cyprus: Are they Fiscally Balanced and Socially Equitable?


  • Hasan U. Altiok

    (Eastern Mediterranean University, Cyprus)

  • Glenn Jenkins

    (Queen's University, Canada and Eastern Mediterranean University, Cyprus)


This paper contains a quantitative assessment of the social security pension reforms in Northern Cyprus (TRNC) that were introduced in 2008 and later refined in 2012. A set of estimations are carried out to determine if the reforms were adequate enough to make the system self-financing. The key question is whether now the contributions over a participants working life would be sufficient to finance the pension promises through retirement. It is found that although significant improvements were made, the new system is neither fiscally neutral nor socially equitable. It delivers a higher budgetary subsidy to high income participants relative to the subsidy received by those with lower incomes. Recommendations are made for the policy changes to correct these defects.

Suggested Citation

  • Hasan U. Altiok & Glenn Jenkins, 2012. "Social Security Reforms in Northern Cyprus: Are they Fiscally Balanced and Socially Equitable?," Development Discussion Papers 2012-02, JDI Executive Programs.
  • Handle: RePEc:qed:dpaper:215

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    References listed on IDEAS

    1. Hasan U. Altiok & Glenn P. Jenkins, 2013. "Social security generosity, budgetary deficits and reforms in North Cyprus," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 16(2), pages 218-235, June.
    2. Mustafa Besim & Glenn Jenkins, 2005. "Tax compliance: when do employees behave like the self-employed?," Applied Economics, Taylor & Francis Journals, vol. 37(10), pages 1201-1208.
    3. Altiok, Hasan U. & Jenkins, Glenn P., 2013. "The fiscal burden of the legacy of the civil service pension systems in northern Cyprus," Journal of Pension Economics and Finance, Cambridge University Press, vol. 12(01), pages 92-110, January.
    4. Jeffrey R. Brown & Robert Clark & Joshua Rauh, 2011. "The Economics of State and Local Public Pensions," NBER Working Papers 16792, National Bureau of Economic Research, Inc.
    5. Brown, Jeffrey R. & Clark, Robert & Rauh, Joshua, 2011. "The economics of state and local pensions," Journal of Pension Economics and Finance, Cambridge University Press, vol. 10(02), pages 161-172, April.
    6. Monika Queisser & Edward R. Whitehouse, 2006. "Neutral or Fair?: Actuarial Concepts and Pension-System Design," OECD Social, Employment and Migration Working Papers 40, OECD Publishing.
    Full references (including those not matched with items on IDEAS)

    More about this item


    pay-as-you-go; social security; pension liabilities; replacement rate; Northern Cyprus;

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • H68 - Public Economics - - National Budget, Deficit, and Debt - - - Forecasts of Budgets, Deficits, and Debt

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