Public Pensions, Capital Formation, And Economic Growth

Dr. Nektarios examines the principles and criteria under lying public pension programs and assesses the effect of these programs on general economic growth. He begins by discussing the economic rationale of public pensions, then analyzes the influence of economic and demographic variables on the cost of a pension program and the effects of public pension systems on aggregate levels of income and capital stock. Suggesting that Feldstein's social security wealth(SSW) variable overestimates the amount of wealth generated by public pensions, Dr. Nektarios constructs a new SSW variable and uses it to estimate the impact of the u.s. Old Age and Survivors Insurance(OASI) program on capital formation and economic growth in the U.S. economy. The results of his econometric analysis suggest that operation of the OASI program has reduced capital formation by 10to 14 percent.

Tables and Figures -- Acknowledgments -- 1. GENERAL INTRODUCTION -- PART 1 - THE ECONOMIC THEORY OF DYNAMIC OLD-AGE PENSIONS -- 2. INTRODUCTION SCOPE AND METHOD -- 3. OLD-AGE PENSIONS IN A PERFECTLY COMPETITIVE ECONOMY -- 4. COLLECTIVE DEMAND FOR OLD-AGE PENSIONS -- The Nature of Demand for Old-Age Pensions Sources of Collective Demand for Old-Age Pension Market Imperfections Concern with the Social Environment -- 5. OLD-AGE PENSIONS IN AN IMPERFECT ECONOMY -- A Holistic Model of Dynamic Pensions Basic Characteristics Financing Provisions Comparisons Between the Holistic Model andOther Models of Public Pensions -- PART 2 - THE INFLUENCE OF THE ECONOMY ON A PAY-AS-YOU-GO SYSTEMS OF PENSIONS -- 6. AN ECONOMIC-DEMOGRAPHIC MODEL OF THE PAY-AS-YOU-GO SYSTEM -- Introduction -- The Model -- Price-Indexed Pensions -- Wage-Indexed Pensions -- The Growth Rate of the Payroll Tax --7. EMPIRICAL EVIDENCE OF THE INFLUENCE OF THE ECONOMY ON THE U.S. OASI PROGRAM -- Simulations of the OASI Program -- Decomposition of the Growth Rate of the Payroll Tax -- PART 3 - THE IMPACT OF A PAY-AS-YOU-GO PENSION SYSTEM ON THE ECONOMY -- 8. INTRODUCTION -- 9. SOCIAL SECURITY WEALTH -- Feldstein's Concept of Social Security Wealth -- A New Concept of Social Security Wealth -- 10. THE IMPACT OF A PAY-AS-YOU-GO PENSION SYSTEM ON THE ECONOMY: REVIEW OF THE LITERATURE -- The Excess Burden of a Pay-As-You-Go Pension System -- The Effect of Public Pensions on Saving -- Empirical Evidence -- Policy Implications of Capital Deficiency -- 11. A PAY-AS-YOU-GO PENSION SYSTEM IN A STEADYSTATE GROWTH MODEL -- 12. THE IMPACT OF A PAY-AS-YOU-GO PENSION SYSTEM ON INCOME AND THE CAPITAL STOCK: EVIDENCE FROM THE U.S. TIME SERIES -- Estimates Based on Consumption Function -- Estimates Based on a System of Simultaneous -- Equations on a Simulation -- Estimates Based -- Conclusions -- APPENDICES -- Appendix A: A Demographic Model -- Appendix B: Description and Sources of -- Variables Used in Chapter 7 -- Appendix C: Social Security Wealth in 1958 Dollars -- Appendix D: Names and Sources of variables -- Used in the Simultaneous Equation System. -- Appendix E: Actual and Simulated Values -- BIBLIOGRAPHY -- INDEX.