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Pension Reform and the Fiscal Policy Stance
Author:
Mr. Philip R. Gerson
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Mr. George A Mackenzie
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Mr. Peter S. Heller
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Mr. Alfredo Cuevas null

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Series:
IMF Working Papers
Volume/Issue:
Volume 2001: Issue 214
Language:
English
Publication Date:
01 Dec 2001
DOI:
https://doi.org/10.5089/9781451874990.001
ISBN:
9781451874990
ISSN:
1018-5941
Pages:
16
Keywords:
WP; deficit; interest rate; debt; rate of return; rate; social security; old age pension; pension reform; fiscal balance; debt default risk; savings behavior; cash-flow deficit; saving rate; explicit debt; deficit target; increase saving; pension fund saving; contribution rate; implicit debt; Pension spending; Pensions; Private savings
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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The increased budget deficit caused by the privatization of a public pension plan does not imply a relaxation of the stance of fiscal policy. The reform's impact on the fiscal stance and national saving depends primarily on its effect on the sum of explicit and implicit public debt and on the post-reform payroll tax and private system contribution rates. However, the precise impact of reform also depends on such influences as the relationship between the rates of interest on implicit and explicit public debt. There may be circumstances in which pension privatization, if not offset by fiscal consolidation, will loosen the fiscal stance.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund