Social Security and Public Insurance

This project is devoted to an article in the Handbook of the Economics of Population Aging edited by John Piggott and Alan Woodland. It sets three accents: (a) Public pensions have large positive/negative impacts on macroeconomic performance: If well designed, they prevent poverty, yield incentives for labor force participation and stabilize consumption in times of crises; if ill designed, the opposite is possible. The macro implications are still underestimated in actual international pension policy decisions. (b) The main channels for large macro impacts are behavioral impacts on labor supply, saving and intergenerational exchange. We know a lot about these micro implications; often, they are nevertheless ignored in policy decisions. (c) The underestimation/ignorance of micro/macro implications is an example why economic design cannot abstract from political economy aspects. This project has been successfully completed with a chapter published in the Handbook of the Economics of Population Aging edited by John Piggott and Alan Woodland.