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Nigeria is a prime example of a developing country with ill-defined property rights. However, people still manage to save, mostly through traditional and informal means, facilitated by strong family and community institutions. This paper argues that the government should concentrate on strengthening these institutions rather than weakening them by imposing an inappropriate, Western-style, formal pensions system on the country.

Means-tested retirement benefits create strong disincentives to work and to save prior to retirement. This article outlines the structure of means-tested benefits in the UK and the USA, and reviews the theoretical and empirical evidence of their incentive effects.

Public pay-as-you-go pension systems induce low fertility rates, which in turn contribute to the insolvency of those very systems. They have replaced the old-age security motive for having children, which is a major factor behind fertility in their absence. They also penalise fertility by externalising the contributions of children while leaving the costs of child-bearing unaffected.Fertility rates could be raised by moving towards personal savings schemes or re-linking pension benefits to fertility.