Social Security in Theory and Practice (I): Facts and Political Theories
40 Pages Posted: 10 Jul 2000 Last revised: 15 Dec 2022
There are 2 versions of this paper
Social Security in Theory and Practice (I): Facts and Political Theories
Date Written: May 1999
Abstract
166 countries have some kind of public old age pension. What economic forces create and sustain old age Social Security as a public program? We document some of the internationally and historically common features of Social Security programs including explicit and implicit taxes on labor supply, pay-as-you-go features, intergenerational redistribution, benefits which are increasing functions of lifetime earnings and not means-tested. We partition theories of Social Security into three groups: political', efficiency' and narrative' theories. We explore three political theories in this paper: the majority rational voting model (with its two versions: the elderly as the leaders of a winning coalition with the poor' and the once and for all election' model), the time-intensive model of political competition' and the taxpayer protection model'. Each of the explanations is compared with the international and historical facts. A companion paper explores the efficiency' and narrative' theories and derives implications of all the theories for replacing the typical pay-as-you-go system with a forced savings plan.
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
The Political Economy of Social Security
By Georges Casamatta, Helmuth Gremer, ...
-
The Aging of the Population and the Size of the Welfare State
By Assaf Razin, Efraim Sadka, ...
-
The Aging Population and the Size of the Welfare State
By Assaf Razin, Efraim Sadka, ...
-
Social Security, Retirement, and the Single-Mindedness of the Electorate
-
Social Security, Retirement, and the Single-Mindedness of the Electorate
-
The Ageing Population and the Size of the Welfare State
By Assaf Razin, Efraim Sadka, ...