Demographic Change, Social Security Systems, and Savings

Abstract In theory, improvements in healthy life expectancy should generate increases in the average age of retirement, with little effect on savings rates. In many countries, however, retirement incentives in social security programs prevent retirement ages from keeping pace with changes in life expectancy, leading to an increased need for life-cycle savings. Analyzing a cross-country panel of macroeconomic data, we find that increased longevity raises aggregate savings rates in countries with universal pension coverage and retirement incentives, though the effect disappears in countries with pay-as-you-go systems and high replacement rates.

Using data envelopment analysis to assess the efficiency of social security systems: the case of income protection in old age

As the number of pensioners in Europe rises relative to the number of people in employment, the gap between the contributions and the benefit levels increases, and consequently ensuring adequate pensions on a sustainable basis has become a major challenge. This study aims to explore the potential of using the Data Envelopment Analysis (DEA) technique in order to access the efficiency of the income protection in old age, one of the most important branches of Social Security. To this effect, we collected data from the 27 European Union Member States regarding this branch. Our results show important differences among the Member States and stress the importance of identifying best practices to achieve more adequate, sustainable and modernised pension systems. Our results also highlight the importance of using DEA as a decision support tool for policy makers.

Social security effects on income distribution: a counterfactual analysis for Brazil

According to Diamond (1977), one of the reasons for the existence of social security systems is that they function as an income redistribution mechanism. There is an extensive literature that tests whether social security systems produce the desired results in developed countries (mainly for the U.S.A.). Nevertheless, there is not an obvious consensus about this social security property and there is little evidence for developing countries. In this article, we test this property for the Brazilian Social Security System. In addition, we also look at another question which has not been answered yet in the previous literature. Is the trend of social security systems increasingly progressive or regressive? We conclude that the changes in Brazilian Social Security legislation reduced inequality between 1987 and 1996, but only for the elderly. For the other age groups, there is a stable trend. Results for the period between 1996 and 2006 reveal that the Brazilian system is neutral for all cohorts. Therefore, we found out that social security systems are not an effective mechanism for income redistribution, as predicted by previous studies.

Social security reforms and their implications for the Caribbean

Includes bibliography

Computerizing the welfare state: An international comparison of computerization in social security

Although computer technology is central to the operation of the modern welfare state, there has been little analysis of its role or of the factors shaping the way in which it is used. Using data generated by expert informants from 13 OECD countries, this paper provides an indicative comparison of the aims of computerization in national social security systems over a 15-year period from 1985 to 2000. The paper seeks to identify and explain patterns in the data and outlines and examines four hypotheses. Building on social constructivist accounts of technology, the first three hypotheses attribute variations in the aims of computerization to different welfare state regimes, forms of capitalism, and structures of public administration. The fourth hypothesis, which plays down the importance of social factors, assumes that computerization is adopted as a means of improving operational efficiency and generating expenditure savings. The findings suggest that, in all 13 countries, computerization was adopted in the expectation that it would lead to increased productivity and higher standards of performance, thus providing most support for the fourth hypothesis. However, variations between countries suggest that the sociopolitical values associated with different welfare state regimes have also had some effect in shaping the ways in which computer technology has been used in national social security systems.

Social security status and mortality in Belgian and Spanish male workers

Objective: To assess differences in mortality rates between social security statuses in two independent samples of Belgian and Spanish male workers. Methods: Study of two retrospective cohorts (Belgium, n = 23,607; Spain, n = 44,385) of 50-60 year old male employees with 4 years of follow-up. Mortality rate ratios (MRR) were estimated using Poisson regression models. Results: Mortality for subjects with permanent disability was higher than for the employed, for both Belgium [MRR = 4.56 (95% CI: 2.88-7.21)] and Spain [MRR = 7.15 (95% CI: 5.37-9.51)]. For the unemployed/early retirees, mortality was higher in Spain [MRR = 1.64 (95% CI: 1.24-2.17)] than in Belgium [MRR = 0.88 (95% CI: 0.46-1.71)]. Conclusion: MRR differences between Belgium and Spain for unemployed workers could be partly explained because of differences between the two social security systems. Future studies should further explore mortality differences between countries with different social security systems.