The Problems and Prospects Faced by Pay-As-You-Go Pension Systems: A Case Study of Greece

Paul Mylonas and Christine de la Maisonneuve

No 215, OECD Economics Department Working Papers from OECD Publishing

Abstract: Without further reforms, pay-as-you-go pension systems throughout most of continental Europe face unsustainable financial imbalances as their population ages. Though this paper describes the Greek pension system, which will face especially severe financial strains, it sheds light on the pension problems of other continental European countries, as these countries’ systems share many common features. The main focus of the paper is on the factors of the Greek pay-as-you-go system which result in its future unsustainability. Exacerbating the deteriorating demographics, the system is characterised by very generous pensions relative to contributions for the pre-1993 generation of workers, as well as other incentives/provisions to retire early. To highlight these facets, the study provides simulations of the generosity of different categories of individual pensions under different scenarios as well as projections of aggregate pension expenditures and revenues. It concludes with options ... S’ils ne font pas l’objet de réformes supplémentaires, les systèmes de retraite par répartition de la plupart des pays d’Europe continentale vont être confrontés à des déséquilibres financiers non viables dus au vieillissement de la population. Ce document décrit le système grec de retraite qui va devoir faire face à des difficultés financières particulièrement importantes. Cependant il expose aussi les problèmes des systèmes de pension des autres pays d’Europe continentale puisque ces régimes ont de nombreuses caractéristiques communes. Le document analyse principalement les éléments du système grec de retraite par répartition qui conduiront à sa non-viabilité future. Outre l’évolution démographique défavorable, le système se caractérise par la générosité des pensions au regard des cotisations pour les travailleurs entrés dans la population active avant 1993, ainsi que par d’autres incitations/dispositifs qui favorisent les départs en retraite anticipée. Pour mettre en évidence ...

Date: 1999-05-10
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Persistent link: https://EconPapers.repec.org/RePEc:oec:ecoaaa:215-en

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