The Political Economy of Social Security

Georges Casamatta (), Helmuth Cremer and Pierre Pestieau

No 259, CESifo Working Paper Series from CESifo

Abstract: We consider a two-period overlapping generations model in which individual voters differ by age and by productivity. In such a setting, a redistributive Pay-As-You-Go system is politically sustainable, even when the interest rate is larger than the rate of population growth. The workers with medium wages (not those with the lowest wages) and the retirees form a majority which votes for a positive level of social secur ity. This level depends on the difference between population growth and interest rate and on the redistributiveness of benefit rule.

Keywords: Social security; majority voting (search for similar items in EconPapers)
Date: 2000
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Citations: View citations in EconPapers (172)

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Related works:
Journal Article: The Political Economy of Social Security (2000)
Working Paper: The political economy of social security (2000)
Working Paper: The Political Economy of Social Security (2000)
Working Paper: The political economy of social security (1999)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_259

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