Pension Regimes in Latin American Emerging Countries: Do and Can Individual Capitalizacion Schemes and PAYG Systems Coexist?

ERNESTO REZK,

Revista de Economia y Estadistica

Departamento de Impresiones, Facultad de Ciencias Económiocas, UNC

Lugar: Córdoba; Año: 2013 vol. LI p. 159 - 159

0034-8066

ൻඌඍඋൺർඍExperts have been pointing out that, although fully funded pensionschemes implemented by several Latin American countries gatheredpolitical rejection and experienced important setbacks, they were resortedto in response to the problems faced in the eighties and the nineties byunfunded regimes. In this connection, the idea is that both individualcapitalization and PAYG systems can and should coexist provided thatefficacy in ensuring expected levels of coverage, equity and efficiencyand in guaranteeing also long run financial sustainability be appropriatelyreached.Nevertheless, several preconditions appear necessary for thepreceding scenario to be possible: coverage and tax compliance needto be expanded in both regimes particularly to include the self employedworkers, individual capitalization needs be improved and turned moreattractive by reducing administrative and commercial costs and by offeringa more varied portfolio composition conce