Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/128344
Authors: 
Lassila, Jukka
Valkonen, Tarmo
Year of Publication: 
2015
Series/Report no.: 
CESifo Working Paper 5640
Abstract: 
We study transitions from EET tax regime to TEE regime in a defined-benefit pension scheme with a numerical overlapping generations model, using stochastic mortality projections as inputs. In a traditional pension scheme with no automatic longevity rules, such as a link between life expectancy and pensions or retirement age, the tax regime shift can be used to improve public finances, when longevity increases. Diminished private saving and weaker labour supply incentives are among the downsides. Especially the latter makes the reform welfare-reducing, if the improvement in state finances is not used to relieve taxation of labour.
Subjects: 
taxation
pensions
longevity
JEL: 
H55
Document Type: 
Working Paper

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