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Public pensions' sustainability and population ageing: Is immigration the solution?
Author(s) -
SERRANO Felipe,
EGUÍA Begoña,
FERREIRO Jesús
Publication year - 2011
Publication title -
international labour review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.433
H-Index - 46
eISSN - 1564-913X
pISSN - 0020-7780
DOI - 10.1111/j.1564-913x.2011.00105.x
Subject(s) - sustainability , immigration , population ageing , pension , economics , pension system , population , general equilibrium theory , macroeconomics , economic policy , finance , political science , ecology , demography , sociology , law , biology
. Population ageing generates problems of financial sustainability for unfunded pension systems in many developed countries. Immigration is often presented as one potential solution to this problem, mainly in countries with high migration inflows. The authors propose a model to analyse the impact of immigration flows on the financial sustainability of the pay‐as‐you‐go method, using Spain as a test case. They show that, despite their size, these inflows do not solve the Spanish pension system's sustainability problem, leading to the need for parametric reforms. The article also presents the intensity of the reforms required to maintain the system's financial equilibrium.