Show Summary Details

Page of

PRINTED FROM OXFORD HANDBOOKS ONLINE (www.oxfordhandbooks.com). © Oxford University Press, 2018. All Rights Reserved. Under the terms of the licence agreement, an individual user may print out a PDF of a single chapter of a title in Oxford Handbooks Online for personal use (for details see Privacy Policy and Legal Notice).

date: 21 August 2019

Abstract and Keywords

A key issue in pension reform is whether such a shift from PAYG to funding is largely a matter of reallocation of the financial burden of ageing (with the risk of a generation paying twice), or whether funding improves economic performance sufficiently to generate some or all of the resources required to meet the needs of an ageing population. The underlying issue is that with characteristics such as greater actuarial fairness, transparency, and flows of funds to securities markets, a funded system may prompt greater economic efficiency than PAYG, which is of wider benefit to the economy. There are several aspects to this question. One is whether funding leads to an increase in saving, which permits higher capital formation. A second is whether, independently of the impact on saving, there are effects of funding that lead to higher economic growth, for example via positive externalities generating more efficient capital and labour markets. A third is whether a direct impact of funding on growth can be discerned. We investigate the literature on these issues and seek to draw conclusions.

Keywords: pension funding, economic growth, PAYG, economic performance, economic efficiency, capital formation, labour markets

Access to the complete content on Oxford Handbooks Online requires a subscription or purchase. Public users are able to search the site and view the abstracts and keywords for each book and chapter without a subscription.

Please subscribe or login to access full text content.

If you have purchased a print title that contains an access token, please see the token for information about how to register your code.

For questions on access or troubleshooting, please check our FAQs, and if you can''t find the answer there, please contact us.