Conventional pension systems suffer from a design defect which makes them financially unsustainable, and a source of inefficiency for the economy as a whole. The paper outlines a second-best policy which includes a public pension system made up of two parallel schemes, a Bismarckian one allowing...

Conventional pension systems suffer from a design defect which makes them financially unsustainable, and a source of inefficiency for the economy as a whole. The paper outlines a second-best policy which includes a public pension system made up of two parallel schemes, a Bismarckian one allowing...

In several developed countries, the ageing process of the population may pose fiscal risks to the PAYG systems of public pensions. This paper studies the determinants of two forms of accessing retirement in Spain, either partial or full retirement. Our goal is to identify if social security...

The paper provides a framework for the conceptualization, definition and estimation of legacy costs that need to be addressed in a reform that transforms an unfunded defined contribution (NDB) scheme into a notional (or non-financial) defined contribution (NDC) scheme. As the new contribution...

The Croatian system of old-age provision comprises a traditional public pay-as-you-go scheme and a mandatory funded scheme ("second pillar") that will provide increasing amounts of supplementary pensions to those entering retirement in the future. Due to the continuing economic crisis, the...

Feldstein [1985] posed the questions of what would be the optimal level of retirement benefit, and what would be the optimal mix between the pay-as-you-go system and the funded pension system under the assumption of an exogenous interest rate. We reconsider the problem with the addition of a...

A model is presented that explains the mix between funded and unfunded pension systems. It turns out that total pension and the relative shares of the two systems may be explained and are determined by the population growth rate, technological growth, the time-preference discount rate, the...

van Groezen, Leers and Meijdam (2003) (for short, GLM) analyzed combination of public pension and child support in an OLG model. We impose credit constraint on workers, and extend GLM's analysis from the case where workers do not understand the cost also to the case where they do. GLM's infinite...