It’s the Years, Not The Mileage: IMF Analysis of Pension Reforms in Advanced Economies

2017-04-15T14:13:20-04:00February 1, 2012|

Indiana Jones, the fictional character of the namesake movies, once said “It’s not the years, it’s the mileage.” The quote comes to mind as many advanced economies wrestle with the best way for pension reform to ensure both retirees and governments don’t go broke. Our view, explained in a new study, is that in fact the years do matter. Our analysis shows that gradually raising retirement ages could help countries contain pension spending increases and boost economic growth.

Promises, Promises. Better Measuring the Effect of Pension Reform

2017-04-15T14:24:56-04:00April 26, 2011|

We all hope to retire one day. Our pensions hold the promise of that. Good fiscal policy means thinking about ho w policy decisions—involving long-term promises, such as pensions—affect government finances both today and in the future. With pension reform a priority for so many countries, it is a problem that traditional deficit and debt indicators focus on the health of public finances today, but fail to capture the future impact of pension promises. We propose a new indicator—the “pension-adjusted” budget balance—that can help measure when changes in pension policies are improving or worsening long-term fiscal health. Used as a complement to traditional indicators, this new indicator could help avoid incentives to delay or even reverse pension reforms.

Post-Crisis: What Should Be the Goal of a Fiscal Exit Strategy?

2017-04-15T14:43:23-04:00November 16, 2009|

One obvious fallout of the global financial crisis is a huge deterioration in fiscal conditions, particularly in advanced countries. The numbers are nothing short of staggering. Gross general government debt in the G-20 advanced economies is projected to approach 120 percent of GDP by 2014, up from about 80 percent in 2007, and this is even assuming no renewal of fiscal stimulus beyond 2010.
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