Customize Consent Preferences

We use cookies to help you navigate efficiently and perform certain functions. You will find detailed information about all cookies under each consent category below.

The cookies that are categorized as "Necessary" are stored on your browser as they are essential for enabling the basic functionalities of the site. ... 

Always Active

Necessary cookies are required to enable the basic features of this site, such as providing secure log-in or adjusting your consent preferences. These cookies do not store any personally identifiable data.

No cookies to display.

Functional cookies help perform certain functionalities like sharing the content of the website on social media platforms, collecting feedback, and other third-party features.

No cookies to display.

Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics such as the number of visitors, bounce rate, traffic source, etc.

No cookies to display.

Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.

No cookies to display.

Advertisement cookies are used to provide visitors with customized advertisements based on the pages you visited previously and to analyze the effectiveness of the ad campaigns.

No cookies to display.

Aging, Social Security Design, and Capital Accumulation

By Antoine Dedry, Harun Onder & Pierre Pestieau
This paper analyzes the impact of aging on capital accumulation and welfare in a country with a sizable unfunded social security system. Using a two-period overlapping generation model with potentially endogenous retirement decisions, the paper shows that the type of aging, i.e. declining fertility or increasing longevity, and the type of unfunded social security system, i.e. defined contributions or defined benefits, are important in understanding this impact. Moreover, the analysis provides a refinement to common policy recommendations that favor eliminating mandatory early retirement regulations in aging societies: aging leads to a greater increase in welfare when it is driven by an increasing longevity and the retirement age is unregulated. In comparison, when aging is driven by a decreasing fertility rate, a mandatory retirement system fosters more savings and, thus, income and welfare, in a closed economy with unfunded pension system based on defined contributions.

Full Content: SSRN