Is Pension Reform Conducive to Higher Saving?
Declining fertility, mortality, and productivity rates in developed countries and the popularity of the social security privatization in Chile as a pathway to financial development have sparked a global interest in social security reform. This paper analyzes the effect of social security on saving using a panel of countries over 25 years. Variation in the characteristics of social security systems is used to determine whether less reliance on a pay-as-you-go, unfunded system is associated with higher national saving. There is little evidence that countries that implement defined-contribution reforms have higher trends in saving rates after the reform. Cross-sectionally, countries with pay-as-you-go systems tend to have lower saving rates, and this effect increases with the coverage rate on the system.
- DOI
- 10.1162/003465300558777
- Volume
- 82 (2)
- Pages
- 264-272
- Language
- en
- Export
- BibTeX
- Sources
- openalex crossref