This paper studies the interaction between macro-economic risk and pay-go social security. For this, it uses an applied general equilibrium model with overlapping generations of risk-averse households. The sources of risk are productivity shocks and depreciation shocks. The risk profile of...

All practical evaluations of fiscal sustainability that include the effects of population ageing must utilize demographic forecasts. It is well known that such forecasts are uncertain, and that has been taken into account in some studies by using stochastic population projections jointly with...