Are national pension systems efficient if labor is (im)perfectly mobile?

Breyer, Friedrich; Kolmar, Martin

doi:10.1016/s0047-2727(00)00170-5

Cited by 39 publications

(25 citation statements)

References 13 publications

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“…They conclude that only a centralized pension system is efficiency preserving. Breyer and Kolmar (2002) build on this work, showing that the harmonization of contributions is not only a necessary condition (as shown before by Homburg and Richter, 1993) but also a sufficient one to ensure efficiency. They further extend the model to allow for mobility costs, finding much more restrictive conditions for an efficient allocation of resources.…”

Section: Related Literaturementioning

confidence: 59%

The political economy of pension systems with low‑skilled labor mobility: a crossss‑country analysis

Gouveia¹

2018

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A navegação consulta e descarregamento dos títulos inseridos nas Bibliotecas Digitais UC Digitalis, UC Pombalina e UC Impactum, pressupõem a aceitação plena e sem reservas dos Termos e Condições de Uso destas Bibliotecas Digitais, disponíveis em https://digitalis.uc.pt/pt-pt/termos.Conforme exposto nos referidos Termos e Condições de Uso, o descarregamento de títulos de acesso restrito requer uma licença válida de autorização devendo o utilizador aceder ao(s) documento(s) a partir de um endereço de IP da instituição detentora da supramencionada licença.Ao utilizador é apenas permitido o descarregamento para uso pessoal, pelo que o emprego do(s) título(s) descarregado(s) para outro fim, designadamente comercial, carece de autorização do respetivo autor ou editor da obra.Na medida em que todas as obras da UC Digitalis se encontram protegidas pelo Código do Direito de Autor e Direitos Conexos e demais legislação aplicável, toda a cópia, parcial ou total, deste documento, nos casos em que é legalmente admitida, deverá conter ou fazer-se acompanhar por este aviso.The political economy of pension systems with lowskilled labor mobility: a crosssscountry analysis Autor(es):Gouveia, Ana Fontoura C O N Ó M I C A S 45Ana Fontoura Gouveia Nova School of Business and Economics ana.gouveia@novasbe.pt the political economy of penSion SyStemS With loW -SkilleD laBor moBility: a croSS -country analySiS Ana Fontoura Gouveia Received for publication: January 3, 2017 Revision accepted for publication: March 27, 2017 ABSTRACT This paper analyzes the impact of international low -skilled labor mobility on the majority support for a pension system in individual countries and on the welfare of the different agents. The two countries considered differ in the amount of redistribution from the high to the low -skilled population embedded in their pay -as -you -go social security systems, whose size (tax rate) is decided by majority voting, anticipating the impact on mobility. We show that labor mobility can create the conditions for a majority to favor pensions in a Bismarckian country, due to the ageing of the population caused by the departure of the young mobile. In a Beveridgean country, mobility does not necessarily undermine the support for the system, but may make the conditions for its existence more stringent, even if no individual migrates in equilibrium. Finally, we show that while labor mobility is always politically sustainable in the non -redistributive country, its political feasibility is at stake in the country performing income redistribution through the pension system whenever the interest rate is not sufficiently large.

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Section: Related Literaturementioning

confidence: 59%

The political economy of pension systems with low‑skilled labor mobility: a crossss‑country analysis

Gouveia¹

2018

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“…Notice that this may be the case even when the contribution rate is lower with ‡at-rate system. 3 If (14) is violated, then everyone would prefer to migrate from country A to B. We can also show Proposition 2 An increase in the probability of international mobility decreases (increases) investment in education in country A (B), provided that there is emigration.…”

Section: Common Labor Marketmentioning

confidence: 70%

“…Wildasin (1999) uses data on public pension contributions and bene…ts to estimate the change in the present value of lifetime wealth for "representative workers" i ns e v e nE U countries, …nding that migrants may experience changes in public pension wealth, up to 25 percent of lifetime wealth. Homburg and Richter (1993) and Breyer and Kolmar (2002) analyze the e¢ciency of national ‡at-rate pension systems when labor is mobile. The e¤ects of migration on competition between Bismarckian and Beveridgean social insurance systems has been analyzed by Cremer and Pestieau (2003).…”

Section: Literature Reviewmentioning

confidence: 99%

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Social security incentives, human capital investment and mobility of labor

Poutvaara

2007

Journal of Public Economics

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Migration between countries with earnings-related and flat-rate pay-as-you-go social security systems may change human capital investments in both countries. The possibility of emigration boosts investments in human capital in the country with flat-rate benefits. Correspondingly, those expecting to migrate from the country with earnings-related benefits to a country with flat-rate benefits may reduce their investment in education. With suitably planned transfers between the two countries, allowing for migration may generate a Pareto-improvement for all current and future generations. Without transfers, either country may be unable to pay for promised benefits when labor becomes mobile. JEL Classification: H55, I2, F22

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“…While their focus is on the case of the place-of-work country paying the benefits to the retirees, other scenarios could easily be integrated. Breyer and Kolmar (2002) explore conditions under which decentralized pension systems lead to efficient outcome in countries that are linked by migration flows. Again retirement is considered to be occurring at a fixed age.…”

Section: Pensions and Migrationmentioning

confidence: 99%

The Retirement of the Migrant Labor Force: Pension Portability and Beyond

Jousten

2014

CESifo Economic Studies

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The Retirement of the Migrant Labor Force: Terms of use: Documents in EconStor mayPension Portability and Beyond AbstractThe specificities of the workforce with a migrant background are often neglected in studies of retirement. Similarly, many studies of migration's impact on pensions often focus on aggregate outcomes -system sustainability or distributive characteristics. The present paper provides a fresh look at the nexus between these two literatures. It discusses the impact of the European social security coordination mechanisms on individual decision-making and on the functioning of social security systems -with a focus on retirement. The paper argues that such effects are non-negligible and are likely to have major policy consequences.JEL-Code: F220, H750, J260, J610.

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Are national pension systems efficient if labor is (im)perfectly mobile?

Cited by 39 publications

References 13 publications

The political economy of pension systems with low‑skilled labor mobility: a crossss‑country analysis

The political economy of pension systems with low‑skilled labor mobility: a crossss‑country analysis

Social security incentives, human capital investment and mobility of labor

The Retirement of the Migrant Labor Force: Pension Portability and Beyond

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