Beggar Thy Thrifty Neighbour: The International Spillover Effects of Pensions Under Population Ageing

Y. Adema, A.C. Meijdam, H.A.A. Verbon

Research output: Working paperDiscussion paperOther research output

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Abstract

This paper explores the international spillover effects of ageing through capital markets when countries have different pension systems.We use a two-country twoperiod overlapping-generations model, where the two countries only differ in their pension schemes.Two forms of population ageing are considered, namely an increase in longevity and a fall in fertility.It is shown that in the long run a country using a funded pension system experiences negative spillovers from the fact that the other country uses a PAYG system.The short-run spillovers, however, are opposite to the spillovers in the long run.
Original languageEnglish
Place of PublicationTilburg
PublisherMacroeconomics
Number of pages33
Volume2006-47
Publication statusPublished - 2006

Publication series

NameCentER Discussion Paper
Volume2006-47

Fingerprint

International spillovers
Population aging
Spillover
Spillover effects
Pensions
Pension system
Pay-as-you-go tax
Capital markets
Pension scheme
Overlapping generations model
Fertility
Short-run

Keywords

  • ageing
  • pensions
  • spillovers

Cite this

Adema, Y., Meijdam, A. C., & Verbon, H. A. A. (2006). Beggar Thy Thrifty Neighbour: The International Spillover Effects of Pensions Under Population Ageing. (CentER Discussion Paper; Vol. 2006-47). Tilburg: Macroeconomics.
Adema, Y. ; Meijdam, A.C. ; Verbon, H.A.A. / Beggar Thy Thrifty Neighbour : The International Spillover Effects of Pensions Under Population Ageing. Tilburg : Macroeconomics, 2006. (CentER Discussion Paper).
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abstract = "This paper explores the international spillover effects of ageing through capital markets when countries have different pension systems.We use a two-country twoperiod overlapping-generations model, where the two countries only differ in their pension schemes.Two forms of population ageing are considered, namely an increase in longevity and a fall in fertility.It is shown that in the long run a country using a funded pension system experiences negative spillovers from the fact that the other country uses a PAYG system.The short-run spillovers, however, are opposite to the spillovers in the long run.",
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Adema, Y, Meijdam, AC & Verbon, HAA 2006 'Beggar Thy Thrifty Neighbour: The International Spillover Effects of Pensions Under Population Ageing' CentER Discussion Paper, vol. 2006-47, Macroeconomics, Tilburg.

Beggar Thy Thrifty Neighbour : The International Spillover Effects of Pensions Under Population Ageing. / Adema, Y.; Meijdam, A.C.; Verbon, H.A.A.

Tilburg : Macroeconomics, 2006. (CentER Discussion Paper; Vol. 2006-47).

Research output: Working paperDiscussion paperOther research output

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AB - This paper explores the international spillover effects of ageing through capital markets when countries have different pension systems.We use a two-country twoperiod overlapping-generations model, where the two countries only differ in their pension schemes.Two forms of population ageing are considered, namely an increase in longevity and a fall in fertility.It is shown that in the long run a country using a funded pension system experiences negative spillovers from the fact that the other country uses a PAYG system.The short-run spillovers, however, are opposite to the spillovers in the long run.

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Adema Y, Meijdam AC, Verbon HAA. Beggar Thy Thrifty Neighbour: The International Spillover Effects of Pensions Under Population Ageing. Tilburg: Macroeconomics. 2006. (CentER Discussion Paper).