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Saving and taxation in a voluntary pension system: Toward an agent-based model

By Bal\ue1zs Kir\ue1ly and Andr\ue1s Simonovits

Abstract

Mandatory pension systems only partially replace old-age income, therefore the government also operates a voluntary pension system, where savings are matched by government grants. Accounting for the resulting tax expenditure, our models describe the income flow from shortsighted to farsighted workers. 1. In rational models, explicit results are obtained, showing the limited learning of shortsighted workers. 2. In agent-based models, this learning is improved and this raises the shortsighted workers' saving and reduces perverse income redistribution

Topics: H55, D91, ddc:330, life-cycle savings, overlapping generations, mandatory pensions, voluntary pensions, agent-based models
Publisher: Budapest: Hungarian Academy of Sciences, Institute of Economics
Year: 2016
OAI identifier: oai:econstor.eu:10419/144704
Provided by: EconStor

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