1) Life tables: sources, use, interpretations, variants.
2) Demographic forecast: scenarios, techniques, interpretation.
3) Pension systems: how they were introduced, when and why. Funded systems vs. pay-as-you-go (PAYG): typology, characteristics and the effect of economic and demographic (unforeseen) change.
4) The “ideal” PAYG pension system: definition and criteria for its design and implementation.
3a) Barr, N. 2002. Reforming pensions: Myths, truths, and policy choices. International Social
Security Review 55(2): 3–36. http://eprints.lse.ac.uk/286/
(also available in Moodle)
3b) Kohli, M. and C. Arza 2011. The political economy of pension reform in Europe. In Handbook of Aging and the Social Sciences, 7th Edition, ed. R.H. Binstock and L.K. George. Amsterdam: Academic Press.
Available: http://www.academia.edu/3716694/The_political_economy_of_pension_reform_in_Europe
(also available in Moodle)
4) De Santis Gustavo (2021) “An improved pay-as-you-go pension system, in comparison with a notional defined contribution system: demographic, economic and policy character”, DiSIA WP 2021/08. Available at: https://local.disia.unifi.it/wp_disia/2021/wp_disia_2021_08.pdf
5) Additional reading material may be indicated in class and, if possible, made available on Moodle
Learning Objectives
a) understand how populations evolve: complexity, implications and time scale;
b) understand pensions systems: their introduction and their evolution over time. Explicit and implicit objectives of pension systems and possible inconsistencies between them. The effect of unforeseen changes in the economic and the demographic sphere. Efficiency and (intra- and intergenerational) equity.
c) How to set up an “ideal” pension system, i.e., relatively immune from policy, demographic and economic risks.
Prerequisites
Basic knowledge of demography: sources and methods.
Teaching Methods
Lectures and pratical applications on PC (in lab, if possible)
Further information
Part of the teaching material to be found in Moodle (https://e-l.unifi.it/). Students with special needs may contact the teacher.
Type of Assessment
If the Covid-19 pandemic gets under control, written examination only, with open questions, on both theoretical issues and practical problems. Same for all students, including those who did not attend classes. Variations are possible (and in this case students will be timely informed), but the standard practice is as follows: the examination is divided in two parts, The first weighs 2/3 on the final grade: 12 questions must be answered in 90 minutes; each correct answer gives 3 grades (max=36 grades overall). No books or external text can be consulted (except those given at the moment of the examination); (own) calculators may be used. In the second part (weighing 1/3 on the final grade) student must show their ability in constructing demographic projections which, coupled with economic assumptions, may (or may not) affect the functioning of one or more pension systems supposedly in operation.
Course program
1) Life tables: origins and use. From death risks to the complete life table. The evolution of life tables over time. Sources.
2) Demographic projections, with and without migration. The component method. Constant and varying rates. Weak and strong ergodicity
3) Pensions systems and their historical, demographic, economic and cultural basis. Main and ancillary objectives of modern pension systems.
Module 2
4) Various types of (PAYG) pension systems: defined benefit, defined contribution, risk sharing, NDC (notional defined contribution)
5) The “ideal” pension system: theoretical definition and practical issues to solve in setting it up.
6) The Italian social security system: short history and current situation.