A Framework for Cost-Benefit Analysis of Totalization Agreements

Erik Meijer, Francisco Pérez-Arce and María J. Prados
Additional contact information
Francisco Pérez-Arce: University of Southern California
María J. Prados: University of Southern California

Working Papers from University of Michigan, Michigan Retirement Research Center

Abstract: International social security totalization agreements eliminate double social security taxation for workers who reside and work in different country from their home country. Because totalization agreements affect a number of economic agents in a variety of ways, we develop a cost-benefit framework of totalization agreements to facilitate the comparison and assessment of these impacts from a cost-benefit perspective. It lists the important stakeholders and the types of potential effects of the agreement on them, and attempts to quantify each type of effects for each stakeholder. The framework can be useful to policy makers and researchers to evaluate the economic implications of current or proposed future agreements, depending on scenarios of economic conditions, characteristics of partner countries, and how they affect different stakeholders. The paper also summarizes what is currently known about the effects and related costs and benefits of totalization agreements. We provide relatively simple and straightforward example calculations for some of these effects, as well as calculations using a stylized micro-economic model for workers and a stylized macro-economic model for firm investment and production allocation. In a few cases, we have both simple calculations of direct effects and model calculations that take more channels into account (under strong assumptions), and they agree well, implying that the simple calculations capture most of the total effect.

Pages: 77 pages
Date: 2020-09
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://mrdrc.isr.umich.edu/publications/papers/pdf/wp410.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 403 Forbidden

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mrr:papers:wp410

Access Statistics for this paper

More papers in Working Papers from University of Michigan, Michigan Retirement Research Center P.O. Box 1248, Ann Arbor, MI 48104. Contact information at EDIRC.
Bibliographic data for series maintained by MRRC Administrator ().