Optimal Redistributive Pensions with Temptation and Costly Self-Control

Pier-Andre Bouchard St-Amant and Jean-Denis Garon

No 274636, Queen's Economics Department Working Papers from Queen's University - Department of Economics

Abstract: We examine how the introduction of self-control preferences influences the trade-off between two fundamental components of a public pension system: the contribution rate and its degree of redistribution. The pension regime affects individuals' welfare by altering how yielding to temptation (i.e. not saving, or saving less) is attractive. We show that proportional taxation increases the cost of self-control, and that this adverse effect is more acute when public pensions become more redistributive.

Keywords: Demand and Price Analysis; Financial Economics (search for similar items in EconPapers)
Pages: 29
Date: 2013-08
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Working Paper: Optimal Redistributive Pensions With Temptation And Costly Self-control (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:quedwp:274636

DOI: 10.22004/ag.econ.274636

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