Pension systems and population growth

Abstract

"The authors build an overlapping-generations model with endogenous fertility to analyse the effects of the pension-system design on population growth. Their model allows for any combination of pay-as-you-go and funded pension schemes and different pension levels. They show that there is a unique stable steady-state equilibrium by solving the relevant non-linear difference equation and derive the full transition dynamics. In the steady state, both population growth and welfare are positively affected by the degree of foundation of the pension and negatively affected by the pension level. But, there is no long-run increase in birth rate and welfare without a short-run decrease." (Author's abstract, IAB-Doku) ((en))

Cite article

Gaggermeier, C. & Lucke, B. (2003): Pension systems and population growth. An overlapping-generations model with endogenous birth rates. Hamburg, 21 p.