Gli effetti perversi dei sistemi a ripartizione / Reform of Social Security

Abstract disponibile solo in lingua inglese

Social security pay-as-you-go systems in Europe and elsewhere in the developed world are in financial trouble due to the ageing of the population, and due also to the greater generosity of benefits motivated by the increased political power of the elderly. These same political considerations make it difficult to reform the system, but reform will have to come eventually if the system is not to collapse. The most attractive, and most radical reform is to return to the original aim of social security systems, which is to help workers save so that they can be financially secure in their old age. This should be combined with the modern movement to privatise State activities. The best way to accomplish this is to introduce fully funded systems managed by private funds that compete for the old age contributions of workers. Such an approach provides an effective retirement system that would be insulated in large part from low birth rates, declining mortality and political pressure to raise benefits to the elderly; it would also encourage greater savings, smaller government spending and faster rates of economic growth.