Ageing and funding systems: actual problems and misleading solutions
The reforms introduced in the Italian pension system during the 90’s have so significantly reduced the amount of the perspective pensions as to spur serious perplexities on the ability of many retired people to enjoy a decent standard of living. In spite of this it is widely argued that the pension system in Italy will be financially unsustainable in the long run. The suggested solutions usually involve raising the age for retirement and the rentrenchement of the public pay-as-you-go system with a corresponding extension privately funded pensions. The article argues that the theoretical and empirical arguments in support of those two recommended measures are weak and one-sided. Indeed, given some features of the Italian economy, they might have negligible or even negative effects.