I show that, in a benchmark OLG model with a Cobb-Douglas production function, returns to the pay-as-you-go system and the funded system are perfectly correlated in the presence of uncertainty about future technology, demography and capital stock. Therefore, uncertainty as such might not be a...

We analyze the political stability of funded social security. Using a stylized theoretical framework we study the mechanisms behind governments capturing social security assets in order to lower current taxes. The results and the driving mechanisms carry over to a fully-fledged and carefully...