 The Political Feasibility of Privatizing Old‐Age InsuranceGeorg Hirte () Scottish Journal of Political Economy, 2003, vol. 50, issue 4, 507-525 Abstract: Though a transition to a fully funded pension system is favoured by many economists, it is not even considered by politicians in Germany. This paper examines the hypothesis that this is in accordance with the preferences of the population. By performing a dynamic CGE analysis referenda on pension policies are simulated. They show that a fully privatizing scheme is not politically feasible in Germany, however long the pre‐announcement period, if the alternatives are the current policy or a partially privatizing policy. This explains why a fully privatizing policy is not an issue in the political debate in Germany. In order to examine what are the reasons for this outcome, the German Bismarckian System is compared to a Beveridge‐System which is similar to the British pension system. Actually, in the latter case, a transition to a fully funded system is what the majority opts for in a dynamically consistent equilibrium. This is evidence that the future of the pension system depends on its history. Date: 2003 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:scotjp:v:50:y:2003:i:4:p:507-525 Ordering information: This journal article can be ordered from Access Statistics for this article Scottish Journal of Political Economy is currently edited by Tim Barmby, Andrew Hughes-Hallett and Campbell Leith More articles in Scottish Journal of Political Economy from Scottish Economic Society Contact information at EDIRC. |
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