Fertility Decisions and the Sustainability of Defined Benefit Pay-as-You-Go Pension Systems

The pay-as-you-go pension system as fertility insurance and an enforcement device

A PAYGO system may serve as insurance against not having children and as an enforcement device for ungrateful children who are unwilling to pay their parents a pension. In fact, the latter was Bismarck’s historic motive for introducing this system. It is true that the PAYGO system reduces the investment in human capital, but if it is run on a sufficiently small scale, it may nevertheless bring ...

On the Intergenerational Pareto Efficiency of Pay-as-you-go Financed Pension Systems

In pay-as-you-go financed pension plans, pension payments to the retired are not drawn from a capital fund accumulated during their working lives but financed directly by the contributions of the current workers/contributors (see e.g. AARON (1982, 7)). As SAMUELSON (1958) and AARON (1966) have shown, this financing method can provide every generation of workers with a better internal rate of re...

Pay As You Go

Until recently, the desire for user privacy in intelligent transportation systems seemed to be at odds with the cost constraints of payment tokens. There is need for low-cost payment devices that can be produced in massive quantities while sophisticated cryptographic techniques seem to be too computationally intensive to be used in such devices. Our Pay-as-you-Go approach will demonstrate that ...

Aging, Myopia, and the Pay-As-You-Go Public Pension Systems of the G7: A Bright Future?

Defined benefit pension plan distribution decisions by public sector employees

a r t i c l e i n f o Studies examining pension distribution choices have found that the tendency of private-sector workers is to select lump sum distributions instead of life annuities resulting in leakage of retirement savings. In the public sector, defined benefit pensions usually offer lump sum distributions equal to employee contributions, not the present value of the annuity. Thus, for te...