Pension reforms in an unequal ageing population

Alexia Fürnkranz-Prskawetz , Vienna Institute of Demography
Miguel Sanchez-Romero, Vienna Institute of Demography
David Zettler, TU Vienna, Institute for Statistics and Mathematical Methods in Economics

As the heterogeneity in life expectancy by socioeconomic status increases, many pension systems imply a wealth transfer from short- to long-lived individuals. Various pension reforms aim to reduce inequalities that are caused by ex--ante differences in life expectancy. However, these pension reforms may themselves induce redistribution effects. We plan to implement a dynamic General Equilibrium-OLG model populated by heterogeneous individuals that differ by gender, education, family size, labor supply, health status, and life expectancy. Within this framework, we will study how different socioeconomic groups respond to various pension reforms and analyze the resulting redistribution effects across these groups.

See extended abstract

 Presented in Session 44. Impacts of Policies and Policy Reforms