IDEAS home Printed from https://ideas.repec.org/a/vrs/auseab/v4y2016i1p33-41n2.html
   My bibliography  Save this article

Theoretical Old-Age Pension Benefits and Replacement Rates in the Baltic States: A Retrospective Simulation

Author

Listed:
  • Rajevska Olga

    (Scientific Institute of Economics and Management, University of Latvia, Riga)

Abstract

The author presents a comparative analysis of old-age pension systems in Estonia, Latvia and Lithuania using a method of retrospective simulation run on a self-developed model. The model baseline case is a person retiring in December 2014 after 40 years of service with nationwide average salary. Other cases include low and high-earners, funded schemes participants and simulations for modified notional capital valorisation formulae. Three study countries return very dissimilar results, which is caused by differences in their pension systems’ designs. Lack of non-contributory element (basic pension) in Latvia leads to a low degree of progressivity, with inexcusably low pensions to low-earners and excessively generous pensions to high-earners. Participation in funded pillar II schemes has not brought any significant gains to pension plan sharers. Notional capital valorisation rules adopted in different countries that use the NDC-system significantly influence pension amount.

Suggested Citation

  • Rajevska Olga, 2016. "Theoretical Old-Age Pension Benefits and Replacement Rates in the Baltic States: A Retrospective Simulation," Acta Universitatis Sapientiae, Economics and Business, Sciendo, vol. 28(1), pages 13-19, December.
  • Handle: RePEc:vrs:auseab:v:4:y:2016:i:1:p:33-41:n:2
    DOI: 10.1515/eb-2016-0002
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/eb-2016-0002
    Download Restriction: no

    File URL: https://libkey.io/10.1515/eb-2016-0002?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    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:vrs:auseab:v:4:y:2016:i:1:p:33-41:n:2. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Peter Golla (email available below). General contact details of provider: https://www.sciendo.com .

    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.