Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/282230 
Year of Publication: 
2023
Series/Report no.: 
KRTK-KTI Working Papers No. KRTK-KTI WP - 2023/09
Publisher: 
Hungarian Academy of Sciences, Institute of Economics, Centre for Economic and Regional Studies, Budapest
Abstract (Translated): 
In Hungary, average initial old age pensions have risen much faster than average pensions over the past decade. Several factors have contributed to this, of which the method of valorization and official earnings statistics are of particular importance. In most countries, initial pensions are determined on the basis of a wage path of several decades, and nominal earnings of each year are valorized (indexed) by the growth of nationwide nominal wages. This is also the method used in Hungary. The comparisons presented in the study show that between 2013 and 2021, the official net wage index may have significantly overestimated the increase in national average net earnings, thus leading to a higher than justified increase in initial pensions. The paper examines several aspects of this issue, including the plausibility of a significant decline in the average pension/net wage ratio, and the dilemmas faced by policymakers in such a situation.
Subjects: 
pensions
indexation
inconsistency of wage statistics
JEL: 
H55
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.