Seminar Paper No . 686 FIVE FALLACIES IN THE SOCIAL SECURITY

نویسنده

  • Mats Persson
چکیده

This paper discusses five examples of the conventional wisdom that has often been expressed in the social security debate, even among academic economists. These are: 1. The major problem in most social security systems is that of demography: people simply live too long. 2. Disregarding the issue of demography, a Pay-As-You-Go system is inferior to a fully funded system since the former usually has a lower rate of return. 3. Disregarding the portfolio aspect (which might favor a PAYG system), a funded system dominates a PAYG system in a world of certainty. 4. The social security system is a suitable instrument for intergenerational risk-sharing. 5. The government is a safe and reliable provider of insurance. ∗ I am indebted to Olivia S. Mitchell and Hiroshi Yoshida for valuable comments on an earlier version of this paper

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تاریخ انتشار 2000