Population aging is just beginning to hit the industrialized countries in full force, and it will have a tremendous impact on capital markets. Capital market effects of population aging are particularly strong in continental European economies such as Germany, with their large pay-as-you- go...

We use a laboratory experiment to investigate the effect that assuming rational expectations has on structural inference in a dynamic discrete choice decision problem. Our experimental design induces preferences up to each subject’s subjective rates of time preference, leaving...

We present a quantitative analysis of international capital flows induced by differential population aging and pension reform. It is well known that within each country, demographic change alters the time path of aggregate savings. This process may be amplified if pension reform shifts old-age...

This paper discusses the consequences of population aging and a fundamental pension reform – that is, a shift towards more pre-funding – for capital markets in Germany. We use a stylized closed-economy, overlapping-generations model to compare the effects of the recent German...

The paper examines the long-term implications of various reform options on retirement entry decisions and the actual retirement age of older workers. It focuses on the changes in pension legislation since 1992 and the reform options discussed by the German Social Security Reform Commission...

Public pensions – the primary pillar of old-age income provision – will, in the future, be less generous than they have been in the past, in particular owing to the impact of demographic change. The pension gap is supposed to be plugged by the second and third pillars of pension...

Germany still has a very generous public pay-as-you-go pension system. It is characterized by early effective retirement ages and very high effective replacement rates. Most workers receive virtually all of their retirement income from this public retirement insurance. Costs are almost 12...

This paper is motivated by the idea to create, wherever possible, rational mechanisms that adapt pension systems automatically to a changed economic and demographic environment, rather than to leave such adaptations to discretionary high-profile pension reforms which all too often stir political...

Over and again, the reduction of working time is praised as the instrument against unemployment in Europe. While the first round argument appears obvious – less work for some will create more work for others – second round repercussions, such as consequential labor cost increases,...

The paper examines the generosity of the European welfare state towards the elderly. It shows how various dimensions of the welfare regimes have changed during the recent 10-15 years and how this evolution was related to the process of economic integration. Dimensions include general generosity...