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Extending coverage in multi-pillar pension systems : constraints and hypotheses, preliminary evidence and future research agenda

Author

Listed:
  • Holzmann, Robert
  • Packard, Truman
  • Cuesta, Jose

Abstract

This report provides a set of preliminary hypotheses and exploratory econometric testing to explain low rates of participation in reformed social security systems, with special emphasis on two Latin American countries. The hypotheses claim that the working poor and self-employed continue to have a specific and strong rationale for avoiding participation in the multi-pillar pension ysstem and that transaction costs, system design issues, and problems of credibility negatively influence the decision of all members of the labor force to participate. Some of the established hypotheses have been subjected to exploratory econometric testing using available household survey data for Chile and Argentina. The results support the conjecture that socioeconometric characteristics matter for non-participation, and that the poor, the uneducated, and the self-employed pose a special challenge to the extension of pensions coverage. The paper outlines a research strategy, including a more social security-focused survey and comparative analyses, to confirm the results presented in this paper, and to test those hypotheses related to the different pension institutions reforming governments have chosen to put in place. Work in this vein has already begun.

Suggested Citation

  • Holzmann, Robert & Packard, Truman & Cuesta, Jose, 2000. "Extending coverage in multi-pillar pension systems : constraints and hypotheses, preliminary evidence and future research agenda," Social Protection and Labor Policy and Technical Notes 21303, The World Bank.
  • Handle: RePEc:wbk:hdnspu:21303
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    Citations

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    Cited by:

    1. Bucheli, Marisa & Forteza, Alvaro & Rossi, Ianina, 2008. "Work history and the access to contributory pensions in Uruguay : some facts and policy options," Social Protection and Labor Policy and Technical Notes 90345, The World Bank.
    2. Doling, John & Vandenberg, Paul & Tolentino, Jade, 2013. "Housing and Housing Finance—A Review of the Links to Economic Development and Poverty Reduction," ADB Economics Working Paper Series 362, Asian Development Bank.
    3. Carmen Li & Javier Olivera, 2009. "Cobertura y afiliación al sistema privado de pensiones del Perú," Capítulos de Libros PUCP / Chapters of PUCP books,in: Efraín Gonzales de Olarte & Javier M. Iguiñiz Echeverría (ed.), Desarrollo económico y bienestar. Homenaje a Máximo Vega-Centeno, edition 1, chapter 8, pages 221-239 Fondo Editorial - Pontificia Universidad Católica del Perú.
    4. John, Susan St. & Willmore, Larry, 2001. "Two Legs are Better than Three: New Zealand as a Model for Old Age Pensions," World Development, Elsevier, vol. 29(8), pages 1291-1305, August.
    5. Alberto Arenas de Mesa & David Bravo & Jere R. Behrman & Olivia S. Mitchell & Petra E. Todd, 2006. "The Chilean Pension Reform Turns 25: Lessons From the Social Protection Survey," NBER Working Papers 12401, National Bureau of Economic Research, Inc.
    6. Packard,Truman G., 2001. "Is there a positive incentive effect from privatizing social security : evidence from Latin America," Policy Research Working Paper Series 2719, The World Bank.
    7. Willmore, Larry, 2007. "Universal Pensions for Developing Countries," World Development, Elsevier, vol. 35(1), pages 24-51, January.
    8. Abigail Barr, 2003. "Risk Pooling, Commitment and Information: An experimental test of two fundamental assumptions," Working Papers 2082, The Field Experiments Website.
    9. Marisa Bucheli & Alvaro Forteza & Ianina Rossi, 2007. "Work history and the access to contributory pensions. The case of Uruguay," Documentos de Trabajo (working papers) 1607, Department of Economics - dECON.
    10. World Bank, 2005. "Household Risk Management and Social Protection in Chile," World Bank Publications, The World Bank, number 14839, September.
    11. (No last name available), Himanshu, 2013. "Poverty and Food Security in India," ADB Economics Working Paper Series 369, Asian Development Bank.
    12. William Adzawla & Shaibu Azumah Baanni & Roger Fianko Wontumi, 2015. "Factors influencing informal sector workers` contribution to pension scheme in the tamale metropolis of Ghana," Journal of Asian Business Strategy, Asian Economic and Social Society, vol. 5(2), pages 37-45, February.
    13. Roberto Gallardo del Ángel, 2009. "A Microeconometric Analysis on the Pension Reforms in Argentina, Bolivia, Mexico and Uruguay," Economía: teoría y práctica, Universidad Autónoma Metropolitana, México, vol. 30(1), pages 83-114, Enero-Jun.
    14. Larry Willmore, 2004. "Universal Pensions in Low Income Countries," Public Economics 0412002, University Library of Munich, Germany.
    15. Whitehouse, Edward, 2000. "How poor are the old? a survey of evidence from 44 countries," Social Protection and Labor Policy and Technical Notes 23141, The World Bank.
    16. Debuque-Gonzales, Margarita, 2013. "Empirical Determinants and Patterns of Research and Development Investment in Asia," ADB Economics Working Paper Series 364, Asian Development Bank.
    17. Xi Chen & Lipeng Hu & Jody L. Sindelar, 2017. "Leaving Money on the Table? Suboptimal Enrollment in the New Social Pension Program in China," NBER Working Papers 24065, National Bureau of Economic Research, Inc.
    18. Giles, John & Wang, Dewen & Park, Albert, 2013. "Expanding social insurance coverage in urban China," Policy Research Working Paper Series 6497, The World Bank.
    19. Li, Carmen A & Olivera, Javier, 2005. "Participation in the Peruvian reformed pension system," Economics Discussion Papers 3618, University of Essex, Department of Economics.
    20. Abigail Barr & Garance Genicot, 2008. "Risk Sharing, Commitment, and Information: An Experimental Analysis," Journal of the European Economic Association, MIT Press, vol. 6(6), pages 1151-1185, December.

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