Systemic Analysis of Pension Systems – Macroeconomic Flows

Abstract

The paper is devoted to the field of pension systems. It puts forward the argument that, the size of resources directed towards the retired is not dependent on their economic form but on the readiness of those working to support those who are retired. Economics, therefore, plays only a secondary role as the economic mechanism is identical no matter what organisational form is chosen. In order to demonstrate this three organisational models are presented: family, pay-as-you-go and funded. Through the comparison of macroeconomic flows in all three of them, it is concluded that they are, in fact, identical to the resulting outcome point of view. The final conclusion, therefore, is that any system is just a means of dividing the current national product among the two groups and the size of resources devoted to pensioners is controlled and determined by the working population.