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Assessing social security: Some useful results

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  • Borgmann, Christoph

Abstract

This paper presents a dense summary of the most fundamental results on the issue of PAYG Social Security. They are presented in a simple and insightful analytical framework by working from the budget constraint of the household. The results presented in detail are a representation of the Aaron-Theorem, the equivalence of debt and Social Security, and a proof that under certain conditions the burden of Social Security on the current young and all future generations equals the benefit payments to the current old. Finally, I include uncertainty in the analysis and touch on the intergenerational risk-sharing implications of Social Security.

Suggested Citation

  • Borgmann, Christoph, 2001. "Assessing social security: Some useful results," Discussion Papers 97, Albert-Ludwigs-Universität Freiburg, Institut für Finanzwissenschaft.
    • Handle: RePEc:zbw:alufin:97
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    References listed on IDEAS

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    1. Borgmann, Christoph, 2002. "Labor income risk, demographic risk, and the design of (wage-indexed) social security," Discussion Papers 100, Albert-Ludwigs-Universität Freiburg, Institut für Finanzwissenschaft.

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    More about this item

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions

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