Premium
Privileging Policy Change? Sustaining Automatic Stabilizing Mechanisms in Public Pensions
Author(s) -
Weaver R. Kent
Publication year - 2016
Publication title -
social policy and administration
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.972
H-Index - 63
eISSN - 1467-9515
pISSN - 0144-5596
DOI - 10.1111/spol.12208
Subject(s) - blame , intervention (counseling) , pension , cartel , mechanism (biology) , pension system , sustainability , psychological intervention , business , economics , public economics , market economy , incentive , finance , psychology , ecology , philosophy , epistemology , psychiatry , biology
Automatic stabilizing mechanisms (ASMs) in pension systems change the policy default so that benefits or contributions adjust automatically to adverse demographic and economic conditions without direct intervention by politicians. This is politically attractive to politicians because it facilitates blame avoiding. But it only works if politicians can refrain from ad hoc interventions when an ASM is triggered. Evidence from Canada, Sweden and Germany suggests a mixed record about their sustainability. Politicians may seek to evade or manipulate the trigger mechanism to avoid blame. A cartel of major parties that insulates pension policy‐making from electoral competition can help to sustain ASMs.