Social security, education, retirement and growth

  1. Echevarría Olave, Cruz Ángel
  2. Iza Padilla, Amaia
Revista:
Hacienda Pública Española / Review of Public Economics

ISSN: 0210-1173

Año de publicación: 2011

Número: 198

Páginas: 9-36

Tipo: Artículo

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Otras publicaciones en: Hacienda Pública Española / Review of Public Economics

Resumen

This paper analyzes, firstly, the expected effects of social security reforms that have been implemented in Spain after 2004 (and, secondly, the expected effects of reductions in the minimum pension) on retirement decision and human capital accumulation (and hence on growth and on income inequality). Individuals in our model economy differ in their innate ability and growth is a by-product of the most skilled individuals� productivity. According to our model, i) increases in the minimum and normal retirement ages are expected to have a strong effect, not only on individuals� retirement decisions, but also on their education investment; ii) augmented incentives to late retirement are not expected to have any effect; iii) reductions in the minimum pension are not expected to have a significant effect unless it is completely eliminated.

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