A Note on the Weak Political Support to Pension Reforms

Luca Beltrametti and Gianluca Cerruti
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Luca Beltrametti: Department of Economics, University of Genoa, Italy
Gianluca Cerruti: Department of Economics, University of Genoa, Italy

Economia Internazionale / International Economics, 2022, vol. 75, issue 4, 429-446

Abstract: In the last decades, many advanced countries have implemented reforms that share the goal of making pension systems more sustainable, efficient and fair. These reforms have been spurred, first and foremost, by the aging of populations and the reduction in their growth rates, challenges that have become particularly compelling in the last decade, in the wake of the economic and financial crisis. However, these reforms were not underpinned by strong political support and, after their implementation, many countries have partially reversed the course. In this note, we investigate two possible interpretations of this lack of political support, either from a “political economy” perspective that analyzes the consequences of the aging of the median voter and by examining the shortcomings of the aforementioned reforms from the perspective of gender equality, the radical change in the allocation of risk from the State and firms against workers, and inequalities in life expectancy related to the socioeconomic conditions of individuals. The arguments are supported by data, both international and referred to the Italian context. Una nota in merito alla debolezza del sostegno politico alle riforme pensionistiche Negli ultimi decenni molte nazioni avanzate hanno implementato riforme accomunate dall’obiettivo di rendere più sostenibile, efficiente e giusto il sistema pensionistico. Tali riforme si sono rese necessarie a causa dell’invecchiamento della popolazione e della riduzione dei tassi di crescita economica. Tuttavia, queste riforme – pur riconosciute necessarie dalla grande parte degli economisti – non sono state supportate da un forte sostegno politico e, negli anni successivi all’implementazione, molti paesi hanno parzialmente invertito la rotta. In questa nota, approfondiamo due possibili interpretazioni di tale mancanza di supporto politico, partendo sia da una prospettiva di “political economy”, che analizza le conseguenze dell’invecchiamento dell’elettore mediano, sia da una disamina dei principali difetti delle summenzionate riforme dal punto di vista dell’uguaglianza di genere, del cambiamento radicale nell’allocazione del rischio (dallo stato e dalle imprese verso i lavoratori) e delle disuguaglianze nell’aspettativa di vita associate a diverse condizioni socioeconomiche degli individui. Le tesi qui esposte sono supportate da dati sia internazionali sia riferiti al contesto italiano.

Keywords: Pension Reforms; Fairness; Sustainability; Political Support; Pay As You Go (PAYG); Defined Benefits (DB); Defined Contribution (DC) (search for similar items in EconPapers)
JEL-codes: H55 H75 J26 J32 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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