The International Spillover Effects of Pension Reform

Yvonne Adema (), Lex Meijdam () and Harrie A. A Verbon ()

No CESifo Working Paper No. 1540, CESifo Working Paper Series from CESifo GmbH

Abstract: This paper explores how pension reforms in countries with PAYG schemes affect countries with funded systems. We use a two-country two-period overlapping-generations model, where the countries only differ in their pension systems. We distinguish between the case where a reform potentially leads to a Pareto improvement in the PAYG country, and where this is impossible. In the latter case the funded country shares both in the costs and the benefits of the reform. However, if a Pareto-improving pension reform is feasible in the PAYG country, a Pareto improvement in the funded country is not guaranteed.

Keywords: international spillover effects; pension reform (search for similar items in EconPapers)
JEL-codes: F21 F41 F47 H55 H63 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-pbe and nep-pub
Date: Written 2005
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