Social Security Reform in Advanced Countries: Evaluating Pension Finance

By Toshihiro Ihori; Toshiaki Tachibanaki | Go to book overview
Save to active project
present, the treatment of pensions for income taxation is complicated in Germany. Only about 25-30 percent of the amount of each individual public pension is considered taxable income. Given that the German marginal income tax is zero in the range between DM0 and about DM13,000 for singles and between DM0 and about DM26,000 for married couples, if pensioners have no other major source of income, they do not pay income tax on their pensions if they do not exceed DM42,000 per year. This is puzzling, because a major share of contributions to social security is essentially tax free. Compared to conventional aims of income redistribution, a regular tax treatment of pensions may be more appealing than a general downward adjustment of the replacement rate. Still, a drastic increase in the tax burden on social security pensions is unlikely to happen. One reason could be government's concerns about the opposition of the elderly voters against a regular tax treatment.

Bach, Stefan and Wiegard, Wolfgang (2001) "Public finance," in Klaus F. Zimmermann (ed.), Frontiers in Economics, Heidelberg: Physica.
Barro, Robert J. (1974) "Are government bonds net wealth?," Journal of Political Economy 82: 1095-117.
Belan, Pascal, Michel, Philippe, and Pestieau, Pierre (1998) "Pareto-improving social security reform," Geneva Papers on Risk and Insurance Theory 23(2), 119-25.
Besendorfer, D., Borgmann, C., and Raffelhüschen, B. (1998) "Ein Plädoyer für intergenerative Ausgewogenheit: Rentenreformvorschläge auf dem Prüfstand," ifo Studien 44: 209-31.
Biedenkopf, Kurt H. and Miegel, Meinhard (1997) Von der Arbeitnehmer-zur Bürgerrente - Das Konzept der Grundsicherung im Alter, Bonn.
Börsch-Supan, Axel (1998) "Zur deutschen Diskussion eines Übergangs vom Umlage- zum Kapitaldeckungsverfahren in der gesetzlichen Rentenversicherung", Finanzarchiv 55: 400-28.
Börsch-Supan, Axel and Winter, Joachim K. (1999) "Pension reform, savings behavior and corporate governance," mimeo, University of Mannheim.
Boldrin, Michele, Dolado, Juan J., Jimeno, Juan F., and Peracchi, Franco (1999) "The future of pensions in Europe," Economic Policy 29: 289-320.
Breyer, Friedrich (1989) "On the intergenerational pareto-efficiency of pay-as-you-go finance pension systems," Journal of Institutional and Theoretical Economics 145: 643-58.
Breyer, Friedrich (1994) "Voting on social security when labor supply is endogenous," Economics and Politics 6(2): 119-30.
Breyer, Friedrich (2001) "Why funding is not a solution to the 'social security crisis'?," DIW Discussion Paper, 254.
Breyer, Friedrich and Graf v.d. Schulenburg, Matthias (1987) "Voting on social security: the family as decision-making unit," Kyklos 40(4): 529-47.
Breyer, Friedrich and Straub, Martin (1993) "Welfare effects of unfunded pension systems when labor supply is endogenous," Journal of Public Economics 50: 77-91.
Buchanan, James M. (1975) "The Samaritan's dilemma," in E. S. Phelps (ed.), Altruism, Morality and Economic Theory, New York: Russel Sage Foundation, 71-85.


Notes for this page

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
Loading One moment ...
Project items
Cite this page

Cited page

Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited page

Bookmark this page
Social Security Reform in Advanced Countries: Evaluating Pension Finance


Text size Smaller Larger
Search within

Search within this book

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

While we understand printed pages are helpful to our users, this limitation is necessary to help protect our publishers' copyrighted material and prevent its unlawful distribution. We are sorry for any inconvenience.
Full screen
/ 291

matching results for page

Cited passage

Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.

Are you sure you want to delete this highlight?