Eligibility for retirement and replacement rates in the Uruguayan multi-pillar pension system (Elegibilidad para el retiro y tasas de reemplazo en el sistema previsional multi-pilar en Uruguay)
Gioia de Melo,
Nicolás Castiñeiras (),
Analía Ardente (),
Oriana Montti (),
Braulio Zelko () and
Federico Araya ()
Revista Desarrollo y Sociedad, 2019, vol. 83, issue 3, 105-144
We project the levels of eligibility and gross replacement rates of the pay-as-you-go and individual capitalization pillars in Uruguay. Based on a random sample of worker administrative records, we estimate years of contributions, formal income, and the evolution of the individual savings fund. Our results suggest that while 51% would be eligible for retirement at age 60, 28% would not be able to retire from the contributory system even at age seventy. We expect that 34% of those retiring at age 60 will receive a minimum pension while the replacement rate is estimated to be 52% relative to the previous yearâ€™s wage. We conclude that Uruguay still faces challenges regarding individualsâ€™ density of contributions and amounts declared as both reduce eligibility levels and impose financial pressure on the pay-as-you-go pillar.
Keywords: Informality; pay-as-you-go; individual savings; minimum pension; Uruguay (search for similar items in EconPapers)
JEL-codes: H55 J26 J46 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:col:000090:017426
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