Abstract
The institutional structures of the various types of European welfare state were established around extra revenues called the dividend that used to be easily available throughout the decades of the 20st century. They, however, ceased to be available at the end of that century. The challenge societies face today is how to manage the institutions having relatively less resources available for their financing. In this paper I analyse selected political economy issues related to pension reforms, such as the worker-retiree conflict of interest, distribution by age of the costs of the loss of demographic dividend, and key goals behind pension reforms. The focus of this paper is on pension reforms in Poland, which actually was an implementation of a thoroughly new pension system. Its design is analysed and discussed from a political economy viewpoint. Furthermore, analysis of the Polish pension system is presented in a broader European context. Jel codes: H55; I31; J11; J18.
Highlights
Throughout Europe, pension systems as well as public finance in general are strongly exposed to the challenges of the 21st century
This applies to the more affluent EU15 as well as to the less affluent new EU member states (Alesina & Glaeser 2004). In both cases the reason is the same: population changes lie at the root of the problem, as the institutional structures of the various types of European welfare state or European Social Model were established around extra revenues called the “demographic dividend” that used to be available throughout the decades of the 20st century
In this paper I analyse selected political economy issues related to pension reforms, such as the worker-retiree conflict of interest, distribution by age of the costs of the loss of demographic dividend, and key goals behind pension reforms
Summary
Throughout Europe, pension systems as well as public finance in general are strongly exposed to the challenges of the 21st century This applies to the more affluent EU15 as well as to the less affluent new EU member states (Alesina & Glaeser 2004). In both cases the reason is the same: population changes lie at the root of the problem, as the institutional structures of the various types of European welfare state or European Social Model were established around extra revenues called the “demographic dividend” that used to be available throughout the decades of the 20st century. Pension systems are deeply rooted in the public perception of societies This applies to developed countries and to those various countries that were historically linked to the European institutional tradition. The public internalised that situation and began to perceive welfare as being granted, solely on the premise they were the citizens of affluent and well organised countries
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