The ongoing process of globalization, which is boosted by technological and political catalysts as well, increasingly raises public concerns. It is feared that international integration will be accompanied by national disintegration, since the income distribution in rich countries will become...

The paper compares the pay-as-you-go system and a capital funded system of old age insurance. The capital funded system has a higher rate of return. Pension income can be obtained at lower costs for the individual. This implies efficiency gains in terms of higher savings and reduced distortion...