Le financement des retraites par capitalisation
Bourgeois-Pichat Jean. ? Financing Retirement Benefits Through Capitalization. In a capitalist economy, there are two ways of financing a retirement scheme : distribution or capitalization. In the first case, the accounts are balanced each calendar year and, in the second, by cohort of birth. People born the same year, and their employers, contribute to the Fund by means of an account, which will eventually belong to the survivors. The money is invested by the Fund and the interest is credited to the same account. The system is organised in such a way that the account is empty the day after the last survivor dies. A formula is established giving, as a function of age, the capital owned by each cohort. The formula is applied to the population of France on January 1st, 1977. It shows that the Fund must own five times the yearly salarial mass with a rate of interest equal to 5 %, and 10 times with a rate of interest equal to zero. This represents an enormous capital, as it is generally assumed that the total capital of a country is equal to 4-5 times the salarial mass. It seems, therefore, that it is impossible for the system to function. In a stable population, the calculations are much more simple. The Coale and Demeny stable populations permit the drawing of a diagram giving the capital owned by the Fund as a function of the rates of interest, fertility and mortality. In order to obtain a capital smaller than 5 times the salarial mass, mortality, fertility, and the rate of interest must be very high. This confirms that, in developed countries, the system is unable to function. The simplifying assumptions used for the calculations are then discussed. With the present economic and demographic conditions in developed countries, the Fund has to receive interests equal to 40 % of the yearly salarial mass. It is possible to examine the national accounts to see if this percentage can be reached. This will be the subject of a forthcoming article.
Year of publication: |
1978
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Authors: | Bourgeois-Pichat, Jean |
Published in: |
Population (french edition). - Institut National d'Études Démographiques (INED). - Vol. 33.1978, 6, p. 1115-1136
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Publisher: |
Institut National d'Études Démographiques (INED) |
Saved in:
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