Child - related pension benefits: The case of Slovakia
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Published
Sep 21, 2024
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Abstract
Population aging and low birth rates are linked to the problem of unsustainability of ongoing pension systems. As demographic predictions follow unfavorable developments, adjusting such pension systems is inevitable. This paper discusses introducing child-related benefits into pension system models and their advantages and disadvantages. The model with child-related pension benefits dependent on the average wage is examined concerning the effects of the child factor on individual fertility. We estimate the size of the child factor in the current setting of Slovakia's pension system. Finally, the optimal setting of the above pension system model is presented and compared with the presented alternatives. We show that the current setting of the pension system can be brought closer to the optimum by, for example, more generous awarding of personal wage points for raising children.
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Melicherčík, I., & Jašurková, T.
(2024).
Child - related pension benefits: The case of Slovakia.
Proceedings Of The Conference Algoritmy, , 179 - 188.
Retrieved from http://www.iam.fmph.uniba.sk/amuc/ojs/index.php/algoritmy/article/view/2168/1039
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References
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[2] CEIC, Slovakia Average Gross Monthly Wages, Retrieved from: https://www.ceicdata.com/en/slovakia/average-monthly-wages-gross-and-net/avg-gross-monthly-wages, Accessed: 2023-02-22.
[3] J. Craig, Replacement level fertility and future population growth, Population Trends, 78 (1994), pp 2–20.
[4] A. Černý and I. Melicherčı́k, Simple explicit formula for near-optimal stochastic lifestyling, European Journal of Operational Research, 284 (2020), pp. 769–778.
[5] Eurostat, Total fertility rate, Retrieved from: https://ec.europa.eu/eurostat/databrowser/view/tps00199/default/table, Accessed: 2023-02-22.
[6] R. Fenge and V. Meier, Pensions and fertility incentives, The Canadian Journal of Economics, 38 (2005), pp. 28–48.
[7] R. Fenge and J. Weizsäcker, Mixing Bismarck and child pension systems: an optimum taxation approach, Journal of Population Economics, 23 (2010), pp. 805–823.
[8] A. Gábos, R. I. Gál and G. Kézdi, Birth order fertility effects of child-related benefits and pensions: A test on Hungarian data, Population Studies, 63 (2009), pp. 215–231.
[9] , A. Giday and S. Szegő, Towards the ”Child-to-parent” based pension allowance (”C2P”), Civic Review, 14 (2018), pp. 302–319.
[10] Act no. 461/2003 Coll. on social insurance as amended, Retrieved from: https://www.slov-lex.sk/pravne-predpisy/SK/ZZ/2003/461/, Accessed: 2023-02-22.
[11] H. W. Sinn, Europe’s demographic deficit: A plea for a child pension system De Economist, 153 (2005), pp. 1–45.
[12] Social Insurance, Current pension value, Retrieved from: https://www.socpoist.sk/socialne-poistenie/dochodkove-poistenie/vseobecne-informacie/aktualna-dochodkova-hodnota, Accessed: 2023-02-22.