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The transition from unfunded pensions may impose a "double burden" on a transitional generation, which must both pay taxes to finance current pension liabilities and save for their own retirement. There are also economic gains which will accrue to future generations from increased rates of...
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Unfunded pay-as-you-go social security policy is considered in the Diamond OLG model where the structure of the finance market is characterized by a finite number of finance firms engaged in Cournot competition in both the loan and deposit markets. There is a stronger case for it, since...
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