Chapter 9. Pension Reforms and Risks: Challenges for Pension Systems in Advanced European Economies
Author:
Anna Cristina D’Addio
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Abstract

Pension reform is high on the agenda of many advanced and emerging market economies, for many reasons. First, public pensions often constitute a large share of government expenditure. Second, population aging means that reforms would be needed just to keep pension spending from rising in the future. Third, in many economies, low or falling pension coverage will leave large segments of the population without adequate income in old age and at risk of falling into poverty. Although a number of studies have assessed the effects of pension reforms on fiscal sustainability, a systematic analysis of equity issues in pension systems—and how countries have grappled with these issues—has yet to be undertaken. This book brings together the latest research on equity issues related to pension systems and pension reforms in the post-crisis world. Some of the key issues covered include: the effect of pension systems on intergenerational equity and the impact of pension reforms on poverty, the effects of pension reform measures on fiscal sustainability and equity, and the fiscal consequences of achieving different equity goals. It also presents country case studies. The volume provides a rich menu of material to assist policymakers and academic audiences seeking to understand the latest research in this area, as well as the lessons and challenges for the design of reforms.

Contributor Notes

This chapter is based on the author’s previous work with Organization for Economic Cooperation and Development (OECD) colleagues, in particular, Monika Queisser, Andrew Reilly, and Edward Whitehouse. Views expressed represent exclusively the opinions of the author and do not necessarily correspond to the views of the OECD or of the governments of its member states. The usual disclaimers apply.
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Challenges and Experience