A Simulation of Social Pensions in Europe

Frieda Vandeninden ()
Additional contact information
Frieda Vandeninden: UNU-MERIT, MGSoG, Maastricht University and Center of Research in Public Economics and Population Economics, Université de Liège

No 2012-008, MERIT Working Papers from United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT)

Abstract: The aim of this paper is to evaluate the impact in terms of poverty and cost of the introduction of social (or non-contributory) pensions in Europe. We use data from the household survey EU-SILC and focus on 17 countries. We simulate - in a static framework - the introduction of two social pension schemes: universal and means tested social pensions. We see that the old-age poverty would substantially decrease (average poverty rate goes from 19.7 to 2.5 per cent with the universal scheme) but not totally, even though the level of the universal pension is set up to the poverty line. The impact on poverty with the means tested social pension is quite similar (though always smaller) than the one with the universal pension, since most elderly have few other income sources than pensions. On the opposite, it costs less. In fact, the means test reduces substantially the number of entitled elderly while the universal pension leads to a 'leakage' to non-poor elderly.

Keywords: old age; poverty; pension systems; social pensions; pensions (search for similar items in EconPapers)
JEL-codes: D19 D31 H55 I38 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://unu-merit.nl/publications/wppdf/2012/wp2012-008.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:unm:unumer:2012008

Access Statistics for this paper

More papers in MERIT Working Papers from United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT) Contact information at EDIRC.
Bibliographic data for series maintained by Ad Notten ( this e-mail address is bad, please contact ).