ECONIS Select – Financing Old Age

07/2010

Selected for the Global Economic Symposium 2010

Populations are ageing in most developed countries, but increasingly also in emerging economies. Rising expenditures for pensions as well as health care and long-term care will claim an increasing share of governments’ or families’ incomes. Ensuring both adequate old-age incomes and the long-term financial sustainability of pension and health-care systems remains a huge challenge.

In a number of emerging economies, most notably in China, pension systems are still underdeveloped and cover only a small part of the population. In the developed world, many pension systems at current rules are not financially sustainable. In response to large implicit pension liabilities, various approaches to pension reform have been put forward, such as increasing the role of private and prefunded pension schemes, reducing public pension benefits, increasing pension age and reducing incentives to retire early. The recent financial and economic crisis has highlighted further risks inherent in both public and private pension systems. While rising unemployment and sharply increasing government debt is putting additional stress on public finances and pay-as-you-go pension schemes, the substantial fall in asset prices has underlined the risks associated with pension funds invested in the financial markets. In the current environment there is the danger that immediate pressures on policy to act result in poorly designed short-term responses with negative long-term consequences for the capacity of pension systems to provide adequate levels of retirement income on a sustainable basis.

• What are the lessons of the financial crisis for the appropriate balance of private and public schemes in the pension system?
• How can the resilience of pension systems to macroeconomic shocks be increased?
• What are the implications for the design, regulation and supervision of private pensions systems?
• Are there implications for the financing of health care and long-term care?
• What can government and the financial industry do to help people make informed choices when planning for their old age?
• What can migration policies and policies raising fertility contribute to easing the demographic challenge?
• How could people be encouraged to prolong their working lives?
• What can government and business do to help elderly workers to acquire the skills and to preserve the physical and mental health needed to remain productive and competitive in today’s work environments?
• Should there be specific pension arrangements for workers in particularly hazardous or arduous jobs?
• Is there a lesson from developed countries’ experience for emerging economies which are still only developing old-age pension systems?
• How can politicians find support for successfully implementing the necessary reforms?

Literature selected from our database ECONIS:

• Title: Pension reform: a short guide / Nicholas Barr and Peter Diamond
  Published: Oxford [u.a.]: Oxford Univ. Press, 2010
  Subject heading: Pension reform / Public pension system / Chile / China
  Link: Table of contents
• Article: How to avoid a pension crisis: a question of intelligent system design / Alessandro Cigno
  In: CESifo GmbH: CESifo economic studies. - Oxford: Univ. Press, ISSN 1610-241X, ZDB-ID 20987614. - Bd. 56.2010, 1, S. 21-37
  Subject heading: Public pension system / Pension reform / Second best / Pay-as-you-go / Family benefits / Labour productivity / Fertility / Theory / Germany
• Title: Filling the pension gap: coverage and value of voluntary retirement savings / Pablo Antolín; Edward R. Whitehouse
  Published: Paris: Organisation for Economic Co-operation and Development, Dir. for Employment, Labour and Social Affairs, Employment, Labour and Social Affairs Committee, 2009
  Subject heading: Old-age security / Private pension
  Link: http://www.sourceoecd.org/10.1787/227200770711
• Article: Reforming pensions: principles, analytical errors and policy directions / Nicholas Barr and Peter Diamond
  In: International social security review. - Geneva: ISSA, ISSN 0020-871X, ZDB-ID 7571823. - Bd. 62.2009, 2, S. 5-29
  Subject heading: Pension reform / Pension finance / World
• Title: Aging population, pension funds, and financial markets: regional perspectives and global challenges for Central, Eastern, and Southern Europe / The World Bank ... Robert Holzmann, ed.
  Corporate body: International Bank for Reconstruction and Development
  Published: Washington, DC: World Bank, 2009
  Subject heading: Aging population / Old-age security / Pension finance / Pension reform / Central Europe / Eastern Europe / Southern Europe
  Link: Table of contents
• Title: Pension policy: the search for better solutions / John A. Turner
  Corporate body: W. E. Upjohn Institute for Employment Research
  Published: Kalamazoo, Mich.: W. E. Upjohn Inst. for Employment Research, 2009
  Subject heading: Pensions policy / Old-age security / Private pension / Pension fund / Insurance coverage / United States
  Link: Table of contents
• Title: Lessons of the financial crisis for the design of national pension systems / Gary Burtless
  Published: München: CESifo, 2009
  Subject heading: Public pension system / Pay-as-you-go / Funded pension system / Financial crisis / Private pension / Return to capital / Portfolio management / Pensions policy / United States / 1950-2009
  Systemvoraussetzungen: Acrobat Reader
• Title: Pensions, social security, and the privatization of risk / [Social Science Research Council]. Ed. by Mitchell A. Orenstein
  Corporate body: Social Science Research Council
  Published: New York, NY [u.a.]: Columbia Univ. Press, c 2009
  Subject heading: Public pension system / Pension reform / Old-age security / Pension finance / Privatization / United States
  Link: Table of contents
• Title: Old Europe ages: reforms and reform backlashes / Axel H. Boersch-Supan; Alexander Ludwig
  Published: Cambridge, Mass., 2010
  Subject heading: Population Dynamics / Aging population / Social security / Public pension system / Pay-as-you-go / Labour Market / Pension reform / Labour Market Policy / Forecast / Germany / Italy / France / 2005-2050
  Link: http://www.nber.org/papers/w15744.pdf
  Request info: - Available
• Article: The development and prospects of China's old-age security system / Hua Yingfang
  In: Social sciences in China. - Abingdon: Routledge, ISSN 0252-9203, ZDB-ID 4041513. - Bd. 30.2009, 1, S. 185-196
  Subject heading: Old-age security / China
• Title: Ageing in East Asia: challenges and policies for the twenty-first century / ed. by Tsung-hsi Fu ...
  Published: London [u.a.]: Routledge, 2009
  Subject heading: Aging population / Old-age security / Social conditions / Forecast / East Asia / 1981-2051
  Links:
  Table of contents
  http://www.loc.gov/catdir/toc/ecip0826/2008036415.html
• Title: Reforming pensions in Europe: economic fundamentals and political factors / Ondrej Schneider
  Published: Prague, 2009
  Subject heading: Public pension system / Pension reform / Pension finance / Public Social Expenditure / Population economics / Public choice / Unionization / EU countries / EU countries (Eastern Europe) / 2004-2050
  Link: http://ies.fsv.cuni.cz/default/file/download/id/10182
• Title: What the stock market decline means for the financial security and retirement choices of the near-retirement population / Alan L. Gustman; Thomas L. Steinmeier; Nahid Tabatabai
  Published: Cambridge, Mass., 2009
  Subject heading: Stock Market / Financial crisis / Elderly workforce / Old-age security / Assets / United States / 1995-2007
  Link: http://www.nber.org/papers/w15435.pdf
  Request info: - Available
• Title: Pensions in Africa / Fiona Stewart; Juan Yermo
  Published: Paris: OECD, Financial Affairs Div., Dir. for Financial and Enterprise Affairs, 2009
  Subject heading: Old-age security / Africa
  Link: http://www.sourceoecd.org/10.1787/227444006716
• Article: The role of institutions and health in European patterns of work and retirement / Axel Börsch-Supan, Agar Brugiavini and Enrica Croda
  In: Journal of European social policy. - London: Sage, ISSN 0958-9287, ZDB-ID 1082229x. - Bd. 19.2009, 4, S. 341-358
  Subject heading: Social security / Public pension system / Disabled people / Retirement / Europe
• Article: From developmental regimes to post-developmental regimes: business and pension reforms in Japan, South Korea and Taiwan / Young Jun Choi
  In: Changing governance and public policy in East Asia. - London [u.a.]: Routledge, ISBN 0-415-41596-9. - 2009, S. 206-227
  Subject heading: Political change / Political reform / Private sector / Old-age security / Japan / South Korea / Taiwan
• Article: Moving from pay-as-you-go to privately managed individual pension accounts: what have we learned after 25 years of the Chilean pension reform? / Joaquín Vial; Angel Melguizo
  In: Pensions. - Basingstoke: Palgrave Macmillan, ISSN 1478-5315, ZDB-ID 22472708. - Bd. 14.2009, 1, S. 14-27
  Subject heading: Pension reform / Pay-as-you-go / Private pension / Chile