Increasing PAYG pension benefits and reducing contribution rates

Luciano Fanti and Luca Gori ()

Economics Letters, 2010, vol. 107, issue 2, 81-84

Abstract: We analyse how a reduced contribution rate affects the balanced pay-as-you-go pension budget in the basic overlapping generations model of neoclassical growth (Diamond, P., 1965. National debt in a neoclassical growth model. American Economic Review 55 (5), 1126-1150). It is shown that PAYG pensions can be increased by reducing the payroll tax paid by the young contributors.

Keywords: PAYG; pension; OLG; model (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (17)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:107:y:2010:i:2:p:81-84

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