In this chapter, we analyse the effects of PAYG and funded pension systems on welfare. The debate on the choice between alternative systems focuses on their effects on savings, capital accumulation, labour supply, economic growth and inequality and the potential benefits of mixed systems in...

We develop an OLG model with realistic assumptions about longevity to analyze the welfare effects of raising the retirement age. We look at a scenario where an economy has a pay-as-you-go defined benefit scheme and compare it to a scenario with defined contribution schemes (funded or notional)....

Rising longevity and falling fertility threaten the sustainability of pay-as-you-go pension chemes. This paper shows that maintaining the intergenerational balance in the Dutch pay-as-you-go pension scheme in the face of increased longevity since the introduction of the scheme in 1957 would have...