Unprivatizing the Pension System: The Case of Poland

Jan Hagemejer, Krzysztof Makarski and Joanna Tyrowicz

No 2013-26, Working Papers from Faculty of Economic Sciences, University of Warsaw

Abstract: In many countries the fiscal tension associated with the global financial crisis brings about the discussion about unprivatizing the social security system. This paper employs an OLG model to assess ex ante the effects of such changes to the pension reform in Poland from 1999 as implemented in 2011 and proposed in 2013. We simulate the behavior of the economy without the implemented/proposed changes and compare it to a status quo defined by the reform from 1999. We find that the changes implemented in 2011 and all of the proposed reform scenarios from 2013 are detrimental to welfare. The effects on capital and output are small and depend on the selected fiscal closure. Implied effective replacement rates are lower. These findings are robust to time inconsistency. The shortsightedness of the governments imposes welfare costs.

Keywords: OLG; PAYG; pension system reform; time inconsistency (search for similar items in EconPapers)
JEL-codes: C68 D72 E17 E25 H55 J11 J24 (search for similar items in EconPapers)
Pages: 19 pages
Date: 2013
New Economics Papers: this item is included in nep-age, nep-cmp, nep-dem, nep-mac and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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http://www.wne.uw.edu.pl/inf/wyd/WP/WNE_WP111.pdf First version, 2013 (application/pdf)

Related works:
Journal Article: Unprivatizing the pension system: the case of Poland (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:war:wpaper:2013-26

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