Public pensions and the intergenerational politics of aging societies

Robert Grafstein
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Robert Grafstein: School of Public and International Affairs, Department of Politics, Baldwin Hall University of Georgia, Athens, GA, USA

Journal of Theoretical Politics, 2015, vol. 27, issue 3, 457-484

Abstract: Nearly all modern public pension programs involve a substantial transfer of wealth from workers to retirees. If parents love their children, why are these intergenerational transfers politically sustainable? This paper develops a cross-national overlapping generations model to explore the impact of income mobility on the way workers and retirees calculate the long-term value of these programs to their children. Mobility affects their evaluations because these programs also redistribute intragenerationally. The analysis shows why a majority of rational voters who care about their descendants can insist on the preservation of current public pension benefits for themselves but accept a future reduction. Implications of this explanation are tested using comparative intergenerational mobility data and a 2001 Eurobarometer survey on pensions.

Keywords: Intergenerational transfer; overlapping generations; public pension (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:sae:jothpo:v:27:y:2015:i:3:p:457-484

DOI: 10.1177/0951629814543861

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