MACROECONOMIC ASPECTS OF TWO PATHS TO THE SUSTAINABILITY OF THE PAY-AS-YOU-GO PENSION SYSTEM UNDER THE EXPECTED DEMOGRAPHIC DEVELOPMENT

Jan Mertl and Radim Valenčík

Economy & Business Journal, 2024, vol. 18, issue 1, 32-42

Abstract: As a result of natural demographic development, population dynamics has been slowing down and life expectancy has been increasing. If we want to maintain the stability of the pay-as-you-go pension scheme, it is necessary to maintain the ratio between those who contribute to the system and those who benefit from it. This can be done either by forcing the retirement period to be enforced or by increasing the incentive role of the pension system to extend the period of employment. The paper is based on a comprehensive view of the use of the second option, i.e. on the effective involvement of the lifelong learning system, health care aimed at preserving the physical and mental dispositions of a person, social work aimed at increasing the employability of handicapped or excluded people. It shows the economic mechanism of motivating the above-mentioned productive services to contribute to the permanent stability of the pension system, and shows the macroeconomic impacts in the form of multiplier effects of these productive services and their effect on changing the character of growth, which can be significantly more environmentally friendly and socially friendly without changing the way it is calculated.

Keywords: pension system; macroeconomics; sustainability; statutory retirement age (search for similar items in EconPapers)
JEL-codes: A (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:isp:journl:v:18:y:2024:i:1:p:32-42

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