Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/26565
Authors: 
Valdés-Prieto, Salvador
Year of Publication: 
2009
Series/Report no.: 
CESifo working paper 2520
Abstract: 
Chile approved in early 2008 the replacement of her two current non-contributory subsidies for the old poor for a unified program with a pioneering design, with phase-in ending in 2012. This paper describes the political economy of this reform and evaluates it with regards to efficiency and equity. The design is analogous to one adopted in Finland in 1957, with two differences: First, the subsidy withdrawal rate in response to the individual's contributory pension benefit is lower, about 30% rather than 50%. Second, preserving a tradition introduced in 1975, benefits are also withdrawn in response to per capita household income.
Subjects: 
Social security
welfare programs
political economy of reform
JEL: 
H55
H53
I38
Document Type: 
Working Paper

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