ABSTRACT
The Italian pension system, prior to 1992, was characterized by large and often unjustified disparities of treatment among workers and very generous seniority pension schemes. Starting with the 'Amato' Law in 1992, several reforms have been delivered to harmonize rules across workers and reduce seniority pensions generosity. Actually, the PAYG system was inspired by a strong progressive principle, implemented mainly with a minimum pension benefit; a progressive pension calculation formula; a partial indexation for higher pensions. The PAYG regime implemented progressivity mainly with a Minimum Pension Benefit (MBP), in the pension calculation formula and in the pension indexation formula. Considering retirement at eligibility, they estimate a strong progressivity for the PAYG system, then redistribution diminishes and approaches zero at regime. Switching to a behavioural model with retirement choices the results are confirmed. Microsimulation Model may be defined as a closed population, backward-forward dynamic ageing model without behavioural responses.
