Pension Reform in an Overlapping Model with Multiple Social Security Systems
Makaleler > Tam Makale · 2011
Yazarlar: Çağaçan DEĞER
Ege Academic Review, SCI Expanded İndekslerine Giren Dergi, Uluslararası, 2011, cilt 11, ss 563-572
Özet
<p>Primarily due to financial sustainability problems, social security reforms have been on the policy agenda of both developed and developing countries for the last decade. Turkish social security system has also been reformed from 1999 to 2008. One aim of this reform is the convergence of social security institutions through convergence of social security parameters. The aim of this study is to analyze the effects of social security parameter convergence, through a replacement rate shock. Research literature on the subject tends to use overlapping generations (OLG) models with single representative household and presents reforms as shock to the constructed model. In order to broadly represent the Turkish social security system, this study presents an OLG model with three separate social security institutions where the heterogeneity is through different benefit payments and contribution rates. Convergence across various institutions is enabled by a replacement ratio shock. This parametric reform is similar to the institutional convergence aimed by the Turkish social security reform. The study concludes by discussing steady state results, model dynamics and implications on Turkish social security reform.<br></p>