ABSTRACT
This chapter reviews the possible saving effects of pension reform. It shows that the case for pension reform having a strong impact on saving is ambiguous at the theoretical level, and cannot be confirmed by the available empirical evidence. The chapter provides a brief discussion of the experience of Peru and Argentina, which complements and extends the discussion on Chile. It examines the broad trends in saving arising from national accounts data, reviews evidence from econometric studies, and compares pension saving trends before and after the reform. The chapter examines what extent pension reform in Latin America will generate saving effects. It provides some cross-country comparisons, and speculates on likely developments. The development of capital markets in Chile following pension reform raises the issue whether the latter will also give a boost to the capital markets in the other Latin American countries.
