Voting on Parametric Reforms of the Pay-As-You-Go Pension System

33 Pages Posted: 22 Jun 2008 Last revised: 28 Sep 2008

See all articles by Georges Casamatta

Georges Casamatta

Toulouse School of Economics (GREMAQ-CNRS); Centre for Economic Policy Research (CEPR)

Joao Luis Brasil Gondim

University of Toulouse 1 - Toulouse School of Economics (TSE)

Multiple version iconThere are 2 versions of this paper

Date Written: September 2008

Abstract

We assess the political support for parametric reforms of the Pay-As-You-Go pension system following a downward fertility shock. Using a continuous time overlapping generations model, we show that, depending on the shape of the utility function, a majority of the population may favor an increase in the contribution rate or a drop in pension benefits. Our framework also allows us to evaluate the political support for raising the retirement age and to determine how the timing of the different reforms affect their political support.

Suggested Citation

Casamatta, Georges and Gondim, Joao Luis Brasil, Voting on Parametric Reforms of the Pay-As-You-Go Pension System (September 2008). Available at SSRN: https://ssrn.com/abstract=1148792 or http://dx.doi.org/10.2139/ssrn.1148792

Georges Casamatta (Contact Author)

Toulouse School of Economics (GREMAQ-CNRS) ( email )

Manufacture des Tabacs (bât. F)
21 Allee de Brienne
31000 Toulouse
France

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Joao Luis Brasil Gondim

University of Toulouse 1 - Toulouse School of Economics (TSE) ( email )

Place Anatole-France
Toulouse Cedex, F-31042
France

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