166 countries have some kind of public old age pension. What economic forces create and sustain old age Social Security as a public program? We document some of the internationally and historically common features of Social Security programs including explicit and implicit taxes on labor supply, pay-as-you-go features, intergenerational redistribution, benefits which are increasing functions of lifetime earnings and not means-tested. We partition theories of Social Security into three groups: political', efficiency' and narrative' theories. We explore three political theories in this paper: the majority rational voting model (with its two versions: the elderly as the leaders of a winning coalition with the poor' and the once and for all election' model), the time-intensive model of political competition' and the taxpayer protection model'. Each of the explanations is compared with the international and historical facts. A companion paper explores the efficiency' and narrative' theories and derives implications of all the theories for replacing the typical pay-as-you-go system with a forced savings plan.
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number
7118.
Length: Date of creation: May 1999 Date of revision: Handle: RePEc:nbr:nberwo:7118
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Find related papers by JEL classification: H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy-Making and Implementation
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Cited by: (explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.) This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page.