Financial Crisis and Pension Reform in Spain: The Effect of Labour Market Dynamics

Journal of Economic Policy Reform, DOI: 10.1080/17487870.2019.1599718, 2019

23 Pages Posted: 10 Feb 2017 Last revised: 17 Apr 2019

See all articles by Jennifer Alonso-García

Jennifer Alonso-García

Université Libre de Bruxelles (ULB) - Department of Mathematics; ARC Centre of Excellence in Population Ageing Research; Netspar

Beatriz Rosado-Cebrián

Department of Accounting and Financial Economy

Date Written: April 9, 2019

Abstract

We analyse the effect of post-financial crisis unemployment dynamics on the Spanish pension system’s financial health using Aggregate Accounting. We compare the basis scenario where the current labour market dynamics persist with a full employment (best-case) scenario. We find that economic risk is the main driver of unsustainability in the short run. However, in the long run the main driver of expenditures lies in the ageing demographic structure. Our results suggest that future reforms should increase labour market participation but confirm that recent pension reforms do not attain sustainability in the long run, indicating the need of further pension reforms.

Keywords: Labour Market, Labour Force Survey, Aggregate Accounting, Sustainability, Pay-As-You-Go, Public Pension

Suggested Citation

Alonso-García, Jennifer and Rosado-Cebrián, Beatriz, Financial Crisis and Pension Reform in Spain: The Effect of Labour Market Dynamics (April 9, 2019). Journal of Economic Policy Reform, DOI: 10.1080/17487870.2019.1599718, 2019, Available at SSRN: https://ssrn.com/abstract=2914691 or http://dx.doi.org/10.2139/ssrn.2914691

Jennifer Alonso-García (Contact Author)

Université Libre de Bruxelles (ULB) - Department of Mathematics ( email )

Brussels
Belgium

ARC Centre of Excellence in Population Ageing Research ( email )

Level 6, Central Lobby (enter via East Lobby)
Australian School of Business Building
Sydney, New South Wales NSW 2052
Australia

Netspar ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Beatriz Rosado-Cebrián

Department of Accounting and Financial Economy ( email )

Avenida de la Universidad s/n
Caceres, 10071
Spain

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