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Reforming pensions: myths, truths, and policy choices

Barr, Nicholas ORCID: 0000-0002-5325-2055 (2002) Reforming pensions: myths, truths, and policy choices. International Social Security Review, 55 (2). 3 - 36. ISSN 0020-871X

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Identification Number: 10.1111/1468-246X.00122


This paper discusses the building blocks of pension reform in the light of economic theory, and their application to different types of economy. The opening section sets out the simple economics of pensions. The second section discusses a series of myths which have proved remarkably persistent. Building on this analysis, the latter part of the paper sets out the foundations of effective pensions policy. The third section discusses the prerequisites which any pension reform must respect, i.e. those things which policy advisers can – and should – assert authoritatively. The fourth section turns to the range of choices facing policymakers, drawing on the very different arrangements in different countries. The main conclusions are threefold: 1. The key variable is effective government. 2. From an economic perspective, the difference between Pay-As-You-Go and funding is second order. 3. The range of potential choice over pension design is wide. One size does not fit all.

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Additional Information: This is an electronic version of an Article published in the International Social Security Review 55 (2) pp. 3-36 © 2002 Blackwell Publishing. LSE has developed LSE Research Online so that users may access research output of the School. Copyright © and Moral Rights for the papers on this site are retained by the individual authors and/or other copyright owners. Users may download and/or print one copy of any article(s) in LSE Research Online to facilitate their private study or for non-commercial research. You may not engage in further distribution of the material or use it for any profit-making activities or any commercial gain. You may freely distribute the URL ( of the LSE Research Online website.
Divisions: European Institute
LSE Health
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HJ Public Finance
Date Deposited: 17 Feb 2008
Last Modified: 01 Apr 2024 08:13

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