We consider a political economy model in which agents have the possibility to hide part of their earnings in order to avoid taxation. Taxation is exclusively used to finance a pension system. If the pension system is implemented, agents in their old age receive a benefit which includes both a...

The authors outline a public pension reform where contribution rates are reduced to zero over a very long horizon and in a Pareto-improving fashion.

The paper evaluates the theoretical literature on public pension schemes. First, the terms pay-as-you-go and capital reserve are made precise. These two systems are then compared, followed by a consideration of their efficiency properties. Thereafter conversion policies are discussed.

The article demonstrates that it is possible to convert a pay-as-you-go pension scheme into a capital reserve pension scheme in a Pareto-improving fashion and in finite time.

This study provides a comprehensive analysis of the generational wealth transfer within Sweden's public pay-as-you-go pension system introduced in 1960. Using extensive administrative registers, the paper quantifies the contributions made and benefits received by each birth cohort. The findings...

The national pension systems problem worsens more and more, in more countries of the world. The PAY-AS-YOU-GO (PAYG) pension systems, based exclusively on the solidarity of the generations, are confronting problems more and more difficult to solve. Their origin is found in the evolution and...

Faced with the need to adjust public pension systems to meet changing demographic, economic and social conditions, most developed countries have created government reserve funds to ensure macroeconomic sustainability. This paper aims to study the importance that this reserve fund plays in the...

In this paper we model an OLG-economy where labour supply is endogenously determined and where we assume that there are two pension systems, namely, a pay-as-you-go system and a funded system. The main question is whether there is an equilibrium involving an old-age pensions system, partly...

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...

A key figure which can be applied to measuring inter-generational imbalances involved in existing public pension schemes is given by the implicit tax that is levied on each generation s life-time income through participation in these systems. The implicit tax arises from the fact that, quite...