Public pay-as-you-go pensions still form the dominant pillar of old-age provision in Germany. This is in marked contrast to the situation in Anglo-Saxon countries. It has advantages if labour markets are strong, e.g., following a quick recovery from the Great Recession. It has disadvantages, as...

The paper discusses the options for a reform of the German pension system using a model developed at CES for the German Council of economic advisors to the Federal Ministry of Economics and Research. It is argued that the German pay-as-you-go-system is efficient in a present value sense but will...

How can retirement savings be increased? We explore a unique policy change in the context of the German pension system to study this question. As of 2005 (with a phase-in period between 2002-04), the German pension administration started to send out annual letters providing detailed and...

This paper considers the possibility that economic liberalization, by which is meant a reduction in tariffs, quotas, capital controls, and other government distortions of international transactions, may reduce private savings rates. A two stage approach is used to analyze a panel data set...

Aging societies will have to rely increasingly on private savings to finance retirement. The natural savings vehicles, stocks and bonds, are unfortunately lacking key risk-sharing features that are built into public retirement. Innovative government debt management can address this problem. The...

We explore empirically how capital inflows into the US and financial deregulation within the United States interacted in driving the run-up (and subsequent decline) in US housing prices over the period 1990-2012. To obtain an ex ante measure of financial liberalization, we focus on the history...

A means tested minimum income for old age creates an incentive for some not to save for old age and instead to free ride. Recent literature is undecided to what extent this inefficient savings distortion should be addressed by a compulsory pension system because resulting labour-leisure...

This paper revisits the role played by myopia in generating a theoretical rationale for pay-as-you-go social security in dynamically efficient economies. Contrary to received wisdom, if the real interest rate is exogenously fixed, enough myopia may justify public pensions but never alongside...

argue that the offsetting effect of social security contributions on household retirement saving depends on how closely the social security programme imitates a private retirement saving plan (i.e. the ‘actuarial’ component of the social security programme) the closer the design of the...