Redistribution and the efficiency of the pay-as-you-go pension system

Johann Brunner ()

No 265, Discussion Papers, Series I from University of Konstanz, Department of Economics

Abstract: The paper considers the efficiency of the pay-as-you-go pension system with endogenous labor supply, when contributions are collected as an income tax. Results from the literature state that in this case a Pareto-improving transition path to a fully-funded system exists, if the interest rate is permanently higher than the growth rate of the economy. It is shown that these results depend crucially on the possibility of replacing the income tax by a lump-sum tax. If one adopts the realistic assumption that such a change is impossible, no Pareto-improving transition path from an unfunded to a funded pension system exists.

Keywords: social security; income taxation; redistribution (search for similar items in EconPapers)
Date: 1993
References: Add references at CitEc
Citations: View citations in EconPapers (30)

Downloads: (external link)
https://www.econstor.eu/bitstream/10419/68914/1/686764218.pdf (application/pdf)

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:zbw:kondp1:265

Access Statistics for this paper

More papers in Discussion Papers, Series I from University of Konstanz, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().