This paper studies human capital formation, labor supply and retirement decisions associated with four alternative regimes of social security. We implement a theoretical model with overlapping generations of households and two different ability types within each generation. We find that with a given social security contribution rate, it is better to transfer income to the elderly as old-age ben...

This paper studies an overlapping generations model with stochastic production and incomplete markets to assess whether the introduction of an unfunded social security system leads to a Pareto improvement. When returns to capital and wages are imperfectly correlated a system that endows retired households with claims to labor income enhances the sharing of aggregate risk between generations. Ou...

We examine changes in material well-being among individuals 65 and over during the last five decades, focusing on poverty and low percentiles of income and consumption, housing quality, and durable ownership. Our analyses make many methodological improvements in the measurement of income and consumption for those with few resources. We answer three related research questions. First, how has pov...

A Common Factor ? Can any common factor be discerned in the wide range of problems and incidents noted above ? Two such factors can be detected but first let us consider the wide range of problems which the Universal Declaration of Human Rights was designed to meet. The Declaration deals with all forms of discrimination between individuals, degrading treatment, fair trials, privacy, freedom of ...

This paper provides a review of the economic literature on social security systems and of practical experiences with building social security institutions. The focus is on the design of the institutions, and on the complicated relation between social security, economic welfare and economic growth at the macro-level. The aim of this review is to provide lessons for building social security schem...

In the political-economy debate people express the idea that immigrants are good because they can help pay for the old, thus help sustaining the social security system. In addition, the median voter whose income derives from wages will wish to keep out the immigrants who will depress his/her wage. Therefore the decisive voter will keep migrants out. The paper addresses these two accepted propos...

In its thirteenth annual report to the Congress’ the Social Security Administration reaflirms its conviction that favorable economic conditions, such as those prevailing today, ogler an exceptional opportunity to develop a comprehensive program that will provide the basic essentials of social security for all persons in all parts of the Nation, A Nation with an annual income in excess of 6200 b...

We consider a two-period overlapping generations model in which individual voters differ not only according to age but also productivity. In such a setting, a (redistributive) Pay-As-You-Go system is politically sustainable, even when the interest rate is larger than the rate of population growth. The medium wages workers (not the lowest) join the retirees to form a majority and vote for a posi...

Many countries suffer from persistently high unemployment rates. The scope for labour market reforms is often limited to measures that hurt neither shareholders nor workers. This paper develops a policy proposal, which allows the government to reduce wage costs without changing the income positions as determined in the process of wage negotiations. It is shown that the introduction of public pr...

This report addresses the challenges arising from a change in Mexico’s official poverty methodology from an income-only basis to a multidimensional basis that includes education, access to health services, access to social security, shelter characteristics, access to basic services, access to food, and level of social cohesion. The concept of poverty underlying this report is drawn from Amartya...