The Impact of Demographic Change on Social Security Financing

44 Pages Posted: 15 Feb 2006

See all articles by William Halter

William Halter

affiliation not provided to SSRN

Richard Hemming

International Monetary Fund (IMF)

Date Written: March 17, 1987

Abstract

This paper examines the relationship between prospective demographic changes and social security tax rates over the long term in four countriesthe Federal Republic of Germany Japan the United Kingdom and the United States. Using a simple projection model it is shown that without significant reform social security programs as constituted in 1980 would have implied substantial increases in social security tax rates by the year 2025 in all four countries. The model is then used to explore how a range of policy options would affect the evolution of tax rates. Recent policy measures taken in each of the countries can be summarized in terms of the model and it is shown that these measures will lead to markedly lower tax rates than with unreformed programs although the tax rate in the Federal Republic of Germany will still be high.

JEL Classification: 3221, 8410, 9150, 9180

Suggested Citation

Halter, William and Hemming, Richard, The Impact of Demographic Change on Social Security Financing (March 17, 1987). IMF Working Paper No. 87/18, Available at SSRN: https://ssrn.com/abstract=884624

William Halter (Contact Author)

affiliation not provided to SSRN

No Address Available

Richard Hemming

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

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