IDEAS home Printed from https://ideas.repec.org/a/eee/poleco/v25y2009i2p163-173.html
   My bibliography  Save this article

Financial market lobbies and pension reform

Author

Listed:
  • Kemmerling, Achim
  • Neugart, Michael

Abstract

We develop a model in which firms in the financial market lobby the government to lower compulsory contributions to the public pension system. Firms lobby in order to increase demand from households for their old-age savings products. We conclude with a comparison of two major pension reforms in Europe exemplifying the influence of financial market lobbies on pension policies.

Suggested Citation

  • Kemmerling, Achim & Neugart, Michael, 2009. "Financial market lobbies and pension reform," European Journal of Political Economy, Elsevier, vol. 25(2), pages 163-173, June.
    • Handle: RePEc:eee:poleco:v:25:y:2009:i:2:p:163-173
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0176-2680(08)00102-X
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Tito Boeri & Guido Tabellini, 2012. "Does information increase political support for pension reform?," Public Choice, Springer, vol. 150(1), pages 327-362, January.
    2. Harrie Verbon & Marijn Verhoeven, 1992. "Decision making on pension schemes under rational expectations," Journal of Economics, Springer, vol. 56(1), pages 71-97, February.
    3. Sinn, Hans-Werner & Uebelmesser, Silke, 2003. "Pensions and the path to gerontocracy in Germany," European Journal of Political Economy, Elsevier, vol. 19(1), pages 153-158, March.
    4. Peter Whiteford & Edward Whitehouse, 2006. "Pension Challenges and Pension Reforms in Oecd Countries," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 22(1), pages 78-94, Spring.
    5. Georges de Menil & Robert Fenge & Pierre Pestieau, 2008. "Pension Strategies in Europe and the United States," Post-Print halshs-00754865, HAL.
    6. repec:bla:scandj:v:102:y:2000:i:3:p:523-45 is not listed on IDEAS
    7. Paola Profeta, 2002. "Retirement and Social Security in a Probabilistic Voting Model," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 9(4), pages 331-348, August.
    8. Paul A. Samuelson, 1958. "An Exact Consumption-Loan Model of Interest with or without the Social Contrivance of Money," Journal of Political Economy, University of Chicago Press, vol. 66(6), pages 467-467.
    9. Bonoli,Giuliano, 2000. "The Politics of Pension Reform," Cambridge Books, Cambridge University Press, number 9780521776066, January.
    10. Breyer, Friedrich, 1994. "The political economy of intergenerational redistribution," European Journal of Political Economy, Elsevier, vol. 10(1), pages 61-84, May.
    11. Arye L. Hillman & Heinrich W. Ursprung, 2008. "Domestic Politics, Foreign Interests, and International Trade Policy," Springer Books, in: Roger D. Congleton & Kai A. Konrad & Arye L. Hillman (ed.), 40 Years of Research on Rent Seeking 2, pages 113-129, Springer.
    12. Grossman, Gene M & Helpman, Elhanan, 1994. "Protection for Sale," American Economic Review, American Economic Association, vol. 84(4), pages 833-850, September.
    13. Cadot, Olivier & Roller, Lars-Hendrik & Stephan, Andreas, 2006. "Contribution to productivity or pork barrel? The two faces of infrastructure investment," Journal of Public Economics, Elsevier, vol. 90(6-7), pages 1133-1153, August.
    14. Dixit, Avinash & Grossman, Gene M & Helpman, Elhanan, 1997. "Common Agency and Coordination: General Theory and Application to Government Policy Making," Journal of Political Economy, University of Chicago Press, vol. 105(4), pages 752-769, August.
    15. Richard Disney & Carl Emmerson & Sarah Smith, 2004. "Pension Reform and Economic Performance in Britain in the 1980s and 1990s," NBER Chapters, in: Seeking a Premier Economy: The Economic Effects of British Economic Reforms, 1980–2000, pages 233-274, National Bureau of Economic Research, Inc.
    16. Streeck, Wolfgang & Trampusch, Christine, 2005. "Economic reform and the political economy of the German welfare state," MPIfG Working Paper 05/2, Max Planck Institute for the Study of Societies.
    17. Potters, Jan & Sloof, Randolph, 1996. "Interest groups: A survey of empirical models that try to assess their influence," European Journal of Political Economy, Elsevier, vol. 12(3), pages 403-442, November.
    18. J. Ignacio Conde-Ruiz & Paola Profeta, 2007. "The Redistributive Design of Social Security Systems," Economic Journal, Royal Economic Society, vol. 117(520), pages 686-712, April.
    19. Assar Lindbeck & Mats Persson, 2003. "The Gains from Pension Reform," Journal of Economic Literature, American Economic Association, vol. 41(1), pages 74-112, March.
    20. Timothy Besley & Stephen Coate, 2001. "Lobbying and Welfare in a Representative Democracy," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 68(1), pages 67-82.
    21. Bernheim, B Douglas & Whinston, Michael D, 1986. "Common Agency," Econometrica, Econometric Society, vol. 54(4), pages 923-942, July.
    22. Guido Tabellini, 2000. "A Positive Theory of Social Security," Scandinavian Journal of Economics, Wiley Blackwell, vol. 102(3), pages 523-545, September.
    23. Galasso, Vincenzo & Profeta, Paola, 2007. "How does ageing affect the welfare state?," European Journal of Political Economy, Elsevier, vol. 23(2), pages 554-563, June.
    24. John Creedy & Richard Disney, 1988. "The new pension scheme in Britain," Fiscal Studies, Institute for Fiscal Studies, vol. 9(2), pages 57-71, May.
    25. Perotti, Enrico & Schwienbacher, Armin, 2009. "The political origin of pension funding," Journal of Financial Intermediation, Elsevier, vol. 18(3), pages 384-404, July.
    26. Grossman, Gene M & Helpman, Elhanan, 1998. "Intergenerational Redistribution with Short-Lived Governments," Economic Journal, Royal Economic Society, vol. 108(450), pages 1299-1329, September.
    27. Rama, Martin & Tabellim, Guido, 1998. "Lobbying by capital and labor over trade and labor market policies," European Economic Review, Elsevier, vol. 42(7), pages 1295-1316, July.
    28. Bonoli,Giuliano, 2000. "The Politics of Pension Reform," Cambridge Books, Cambridge University Press, number 9780521772327, January.
    29. Casey B. Mulligan & Xavier Sala-i-Martin, 1999. "Social security in theory and practice (I): Facts and political theories," Economics Working Papers 384, Department of Economics and Business, Universitat Pompeu Fabra.
    30. Aidt, Toke S., 1998. "Political internalization of economic externalities and environmental policy," Journal of Public Economics, Elsevier, vol. 69(1), pages 1-16, July.
    31. Woojin Chung & Richard Disney & Carl Emmerson & Matthew Wakefield, 2006. "Public policy and retirement saving incentives in the UK," Discussion Papers 06/03, University of Nottingham, Centre for Finance, Credit and Macroeconomics (CFCM).
    32. Galasso, Vincenzo & Profeta, Paola, 2002. "The political economy of social security: a survey," European Journal of Political Economy, Elsevier, vol. 18(1), pages 1-29, March.
    33. Börsch-Supan, Axel & Reil-Held, Anette & Schunk, Daniel, 2008. "Saving incentives, old-age provision and displacement effects: evidence from the recent German pension reform," Journal of Pension Economics and Finance, Cambridge University Press, vol. 7(3), pages 295-319, November.
    34. Friedrich Breyer, 1994. "Voting On Social Security When Labor Supply Is Endogenous†," Economics and Politics, Wiley Blackwell, vol. 6(2), pages 119-130, July.
    35. Verhoeven, Marijn J. M. & Verbon, Harrie A. A., 1991. "Expectations on pension schemes under non-stationary conditions," Economics Letters, Elsevier, vol. 36(1), pages 99-103, May.
    36. Avinash Dixit, 1996. "Special-Interest Lobbying and Endogenous Commodity Taxation," Eastern Economic Journal, Eastern Economic Association, vol. 22(4), pages 375-388, Fall.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Neugart, Michael & Kemmerling, Achim, 2015. "The emergence of redistributive pensions in the developing world," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112884, Verein für Socialpolitik / German Economic Association.
    2. Corneo, Giacomo & Keese, Matthias & Schröder, Carsten, 2010. "The Effect of Saving Subsidies on Household Saving – Evidence from Germanys," Ruhr Economic Papers 170, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    3. Niklas Potrafke, 2012. "Is German domestic social policy politically controversial?," Public Choice, Springer, vol. 153(3), pages 393-418, December.
    4. repec:zbw:rwirep:0170 is not listed on IDEAS
    5. Neyapti, Bilin, 2013. "Modeling institutional evolution," Economic Systems, Elsevier, vol. 37(1), pages 1-16.
    6. Hollanders, D.A. & Vis, B., 2009. "Voters' Commitment Problem and Welfare-Program Reforms," Other publications TiSEM b07d1e30-5614-415f-b1a0-7, Tilburg University, School of Economics and Management.
    7. Hollanders, D.A. & Vis, B., 2009. "Voters' Commitment Problem and Welfare-Program Reforms," Discussion Paper 2009-93, Tilburg University, Center for Economic Research.
    8. Arjen van der Heide & Sebastian Kohl, 2024. "Private Insurance, Public Welfare, and Financial Markets: Alpine and Maritime Countries in Comparative-Historical Perspective," Politics & Society, , vol. 52(2), pages 268-303, June.
    9. Achim Kemmerling & Michael Neugart, 2019. "Redistributive pensions in the developing world," Review of Development Economics, Wiley Blackwell, vol. 23(2), pages 702-726, May.
    10. Du, C. & Muysken, J. & Sleijpen, O.C.H.M., 2010. "Economy wide risk diversification in a three-pillar pension system," Research Memorandum 055, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
    11. Giacomo Corneo & Matthias Keese & Carsten Schröder, 2010. "The Eff ect of Saving Subsidies on Household Saving – Evidence from Germanys," Ruhr Economic Papers 0170, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    12. Du, C. & Muysken, J. & Sleijpen, O.C.H.M., 2010. "Economy wide risk diversification in a three-pillar pension system," Research Memorandum 055, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Georges Casamatta & L. Batté, 2016. "The Political Economy of Population Aging," Post-Print hal-02520521, HAL.
    2. Grégory De Walque, 2005. "Voting on Pensions: A Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 19(2), pages 181-209, April.
    3. Casamatta, G. & Batté, L., 2016. "The Political Economy of Population Aging," Handbook of the Economics of Population Aging, in: Piggott, John & Woodland, Alan (ed.), Handbook of the Economics of Population Aging, edition 1, volume 1, chapter 0, pages 381-444, Elsevier.
    4. Neugart, Michael & Kemmerling, Achim, 2015. "The emergence of redistributive pensions in the developing world," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112884, Verein für Socialpolitik / German Economic Association.
    5. Galasso, Vincenzo & Profeta, Paola, 2002. "The political economy of social security: a survey," European Journal of Political Economy, Elsevier, vol. 18(1), pages 1-29, March.
    6. Börner, Kira, 2004. "Political Economy Reasons for Government Inertia: The Role of Interest Groups in the Case of Access to Medicines," Discussion Papers in Economics 313, University of Munich, Department of Economics.
    7. Achim Kemmerling & Michael Neugart, 2019. "Redistributive pensions in the developing world," Review of Development Economics, Wiley Blackwell, vol. 23(2), pages 702-726, May.
    8. Laussel, Didier & Le Breton, Michel, 2001. "Conflict and Cooperation: The Structure of Equilibrium Payoffs in Common Agency," Journal of Economic Theory, Elsevier, vol. 100(1), pages 93-128, September.
    9. Miroslav Verbič & Rok Spruk, 2019. "Political economy of pension reforms: an empirical investigation," European Journal of Law and Economics, Springer, vol. 47(2), pages 171-232, April.
    10. Fredriksson, Per G. & Svensson, Jakob, 2003. "Political instability, corruption and policy formation: the case of environmental policy," Journal of Public Economics, Elsevier, vol. 87(7-8), pages 1383-1405, August.
    11. Uk Hwang & Francesco Magris, 2005. "Intergenerational Conflicts and the Resource Policy Formation of a Short-Lived Government," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 141(III), pages 437-457, September.
    12. Boerner, Kira, 2005. "Having Everyone in the Boat May Sink it - Interest Group Involvement and Policy Reforms," Discussion Papers in Economics 730, University of Munich, Department of Economics.
    13. Hayo, Bernd & Ono, Hiroyuki, 2010. "Comparing public attitudes toward providing for the livelihood of the elderly in two aging societies: Germany and Japan," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 39(1), pages 72-80, January.
    14. Martimort, David, 2019. ""When Olson Meets Dahl": From Inefficient Groups Formation to Inefficient Policy-Making," CEPR Discussion Papers 13843, C.E.P.R. Discussion Papers.
    15. Eliste, Paavo & Fredriksson, Per G., 2002. "Environmental Regulations, Transfers, and Trade: Theory and Evidence," Journal of Environmental Economics and Management, Elsevier, vol. 43(2), pages 234-250, March.
    16. Attar, Andrea & Majumdar, Dipjyoti & Piaser, Gwenaël & Porteiro, Nicolás, 2008. "Common agency games: Indifference and separable preferences," Mathematical Social Sciences, Elsevier, vol. 56(1), pages 75-95, July.
    17. Ujhelyi, Gergely, 2009. "Campaign finance regulation with competing interest groups," Journal of Public Economics, Elsevier, vol. 93(3-4), pages 373-391, April.
    18. Josip Lesica, 2018. "Lobbying For Minimum Wages," Economic Inquiry, Western Economic Association International, vol. 56(4), pages 2027-2057, October.
    19. ATTAR, Andrea & MAJUMDAR, Dipjyoti & PIASER, Gwenaêl & PORTEIRO, Nicolàs, 2003. "Common agency games with separable preferences," LIDAM Discussion Papers CORE 2003102, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    20. Levine, David K. & Modica, Salvatore, 2017. "Size, fungibility, and the strength of lobbying organizations," European Journal of Political Economy, Elsevier, vol. 49(C), pages 71-83.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:poleco:v:25:y:2009:i:2:p:163-173. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/505544 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.