my path to pension reform

My interest in pension reform began 19 years ago, in April of the year 2000. I was at an OECD conference in Prague, listening to presentations of two World Bank economists (Estelle James and Dimitri Vittas). At that moment, it suddenly dawned on me that an ideal pension system should provide basic pensions for everyone, funded pay-as-you-go from general government revenue, allowing citizens who desire more than basic income in retirement to save in any way they please, without subsidies, tax breaks or coercion from government. This was my ‘Eureka’ moment.

When it was my turn to speak, the very next day, I spoke with excitement and enthusiasm. The conference was on private pensions, so the audience did not react warmly to my talk. Nonetheless, I presented my core ideas orally, and drafted a discussion paper (“Three Pillars of Pensions?”) immediately after the conference.

The OECD published a version of my paper “edited for length” in 2001 on pp. 385-397 of its “Private Pensions Conference 2000” proceedings. The editors changed the subtitle from “A proposal to end mandatory contributions” to a blander “Is there a need for mandatory contributions?” In my opinion, the OECD editors removed essential points from the paper. For the record, I have posted the full discussion paper here, highlighting all their deletions in yellow. I have also posted it at the Munich Personal RePEc Archive (free registration required).

Then I worked, with Susan St John of Auckland University, on a study of the universal pension system in New Zealand. Following that, I studied the equally impressive universal pension system in Mauritius. I have never had the opportunity to visit either country, but feel that I know them. The final version of the first study was published as “Two Legs are Better than Three: New Zealand as a Model for Old Age Pensions” in World Development (co-authored with S. St. John, in World Development (August 2001). The second study was published first as a United Nations DESA Discussion Paper “Universal pensions in Mauritius: Lessons for the rest of us” in April 2003, and later – much revised – as  “Universal Age Pensions in Developing Countries: The Example of Mauritius‘, in International Social Security Review, October 2006.

In July of 2004 I left the United Nations with a pension, and moved to Austria, where I spent many enjoyable and productive years at IIASA, a research institute located in Laxenburg, just south of Vienna. I immediately continued my work on pension reforms, circulating a first draft in October 2004 as an Initiative for Policy Dialogue Discussion Paper, “Universal pensions in low income countries“. A final, much revised, version of this paper was published as “Universal Pensions for Developing Countries” in the January 2007 edition of World Development.

Since that 2007 publication I have worked on other subjects, including internal migration in China, but my interest in pension reform continues. My views have not changed since 2007, but I sometimes write something, usually in response to an article or book that upsets me.

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