Extending coverage in multi-pillar pension systems : constraints and hypotheses, preliminary evidence and future research agenda
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.
|Date of creation:||31 Jan 2000|
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