Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/75594
Authors: 
Casamatta, Georges
Cremer, Helmuth
Pestieau, Pierre
Year of Publication: 
2000
Series/Report no.: 
CESifo Working Paper 259
Abstract: 
We consider a two-period overlapping generations model in which individual voters differ by age and by productivity. In such a setting, a redistributive Pay-As-You-Go system is politically sustainable, even when the interest rate is larger than the rate of population growth. The workers with medium wages (not those with the lowest wages) and the retirees form a majority which votes for a positive level of social secur ity. This level depends on the difference between population growth and interest rate and on the redistributiveness of benefit rule.
Subjects: 
Social security
majority voting
Document Type: 
Working Paper

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