Rapidly increasing life expectancy is seen by economists as a serious impediment to the financing of social security systems, no matter whether they are funded or not. However, what is less obvious is that these systems themselves may contribute to the increase in life expectancy by distorting...

It is first shown that the potential of the market mechanism to solve pressing problems of resource allocation is not being used to its full extent, and three examples from the field of social policy are given. Secondly, it is argued that the public often ignores the advice of economists because...

In the academic debate on systems of old-age insurance no question is as controversial and as vigorously discussed as the choice between funded and unfunded financing modes. At first glance this is surprising because this choice seems to involve only an efficiency problem. However, closer...