The Evolution of Public Pension Schemes

1 Introduction.- 1.1 An introduction to the problem.- 1.2 Outline of the book.- 2 The History of Transfer Payments for the Old.- 2.1 Introduction.- 2.2 The history of old-age transfers before government intervention.- 2.3 The history of three public pension plans compared.- 2.4 What can we learn from history?.- 2.5 Summary.- 3 The Case for Government Intervention.- 3.1 Introduction.- 3.2 Market failure.- 3.3 Paternalism.- 3.4 Redistribution.- 3.5 Administrative efficiency.- 3.6 Political and economic arguments compared.- 3.7 Summary.- 4 The Choice of Financing Method: Economic Motives.- 4.1 Introduction.- 4.2 Economic considerations.- 4.3 The generalized Aaron-condition.- 4.4 Conversion policies.- 4.5 Summary.- 5 The Choice of Financing Method: Political Motives.- 5.1 Introduction.- 5.2 Decision-making in a direct democracy.- 5.3 A simple decision-making model.- 5.4 An application to the Netherlands.- 5.5 Generalizations and other models.- 5.6 Summary.- 6 Tax-Transfer View, Altruism and Political Power.- 6.1 Introduction.- 6.2 The tax-transfer versus the insurance vision.- 6.3 Altruism and the public pension scheme.- 6.4 Collective decision-making and public pensions.- 6.5 Altruism and imperfect capital markets.- 6.6 Summary.- Appendix 6A Altruism and the Aaron-condition (the non-cooperative case).- Appendix 6B Stackelberg-behavior and future positive savings.- 7 Uncertainty and Redistribution.- 7.1 Introduction.- 7.2 Financing method and redistribution.- 7.3 Risk aversion and public pension plans.- 7.4 Summary.- Appendix 7A Redistribution and financing method: Z generations.- Appendix 7B Intragenerational redistribution.- Appendix 7C Intergenerational redistribution.- 8 The Rise and Evolution of Payg-Systems.- 8.1 Introduction.- 8.2 Survey of models.- 8.3 A decision-making model with uncertainty and constant Aaron-variable.- 8.4 Public pension plans under a non-constant Aaron-variable.- 8.5 The future of the PAYG-system.- 8.6 Discussion and summary.- 9 Public