ABSTRACT
Latin America has been at the vanguard of pension "privatization" in the world: by mid-2000, half of the twenty countries in the region had introduced structural reforms that are having and will have significant social and economic effects. This chapter discusses the models and characteristics of the pension reforms in the region and provides an evaluation of their impact on the insured, the economy, and old-age people. There are three general models of pension reform: substitutive, parallel, and mixed. The effects of the pension reform will be evaluated on: the insured, the economy, and old-age people. Effective competition is an outcome of the number of pension administrators, available information of their performance, education and freedom of choice of the insured, etc. Coverage is measured as the total number of affiliates and active contributors as percentages of the labor force in 1998. The reduction of fiscal cost of the transition involves a sacrifice in the beneficiary's welfare, i.e., a lower pension.
