ABSTRACT
The role that public pensions play in ensuring cohesion in a modern society is likely to be as important as any economic effect that they may have. In addition, history shows that serious problems with the operation of public pensions are frequently as much the result of institutional weaknesses as of design flaws. One key to successful implementation of a public pension program, therefore, is the willingness and ability of the government to enforce collections from reluctant individual and organizational contributors. Shifting some or all of the responsibility for managing public pension plans from the public sector to the private sector has occasionally been advocated as a mechanism for reducing the cost of supporting the retired. A number of concerns have been raised about the economic impact of pay-as-you-go, public pension programs. The chapter also presents an overview of the key concepts discussed in this book.
