Differential Mortality and Redistribution in the Italian Notional Defined Contribution System

In this paper we assess, through a financial measure (Net Present Value Ratio), the extent of the lifetime earning redistribution operated by the Notional Defined Contribution in a sample of individuals representative of the Italian population born from 1975 to 2000. Controlling mortality by the level of education we identify at least three channels of redistribution: among genders (from men to women), along educational lines (from low to high educated) and among income quintiles (from poor to rich). This happens because some groups systematically live less than average (men, loweducated and poor) while others live more than average (women, high educated and rich). This finding is not trivial: even if the NDC system assure long term financial sustainability, it harms the most disadvantaged groups like poor and low-educated people.