The Impact of Social Security Wealth on the Distribution of Wealth in the European Union
26 Pages Posted: 6 Jun 2022 Last revised: 23 Jun 2022
Date Written: May 30, 2022
The aging of society increases the importance of public pension systems. This study evaluates the influence of public pension entitlements on wealth inequality. Novel data source - the Eurosystem Household Finance and Consumption Survey – is used to compare the impact of the public pension system on wealth inequality in 19 European countries. Findings indicate that in all investigated countries, social security wealth reduces wealth inequality. The augmented wealth inequality is ca. 30% lower than the private wealth inequality. Social security wealth mitigates not only wealth inequality measured at the country level but also wealth inequality in the whole European Union.
Keywords: household finance, household wealth, social security wealth, European Union, Household Finance and Consumption Survey
JEL Classification: D31, G51, H55
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