Demographic Dynamics for the Pay - as - You - Go Pension System

PURE MATHEMATICS AND APPLICATIONS, Vol. 15, pp. 357-374

Posted: 18 Jul 2011

See all articles by Sergio Bianchi

Sergio Bianchi

University of Cassino

Massimo Angrisani

Sapienza University of Rome

Anna Attias

Sapienza University of Rome

Zoltan Varga

affiliation not provided to SSRN

Date Written: 2006

Abstract

The present study focuses on certain problems of pay-as-you-go pension systems. In particular, based on reproduction and survival rates, a Leslie type model is used for the analysis of the demographic dynamics of a population. The presented model is different from the classical Leslie model, since it considers a population divided into sexes, implying that the system matrix does not satisfy the irreducibility and primitivity conditions used in the Perron-Frobenius theory. Applying this theory to a submatrix corresponding to a subpopulation of females, the existence of an asymptotic age distribution is proved and then extended to the whole population. The obtained result is applied to the Italian population, providing projections on its demographic evolution. In the paper the impact of the asymptotic demographic equilibrium on the pay-as-you-go pension system, in terms of financial sustainability, is also studied.

Keywords: pay - as - you - go pension system, Leslie type model, population dynamics, demographic equilibrium

JEL Classification: C61, C62, C68, H55

Suggested Citation

Bianchi, Sergio and Angrisani, Massimo and Attias, Anna and Varga, Zoltan, Demographic Dynamics for the Pay - as - You - Go Pension System (2006). PURE MATHEMATICS AND APPLICATIONS, Vol. 15, pp. 357-374, Available at SSRN: https://ssrn.com/abstract=1886400

Sergio Bianchi (Contact Author)

University of Cassino ( email )

Via S. Angelo - Campus Folcara
Dept. of Economics and Law
Cassino, 03043
Italy
+3907762994846 (Phone)
+390776393034 (Fax)

HOME PAGE: http://www.docente.unicas.it/sergio_bianchi

Massimo Angrisani

Sapienza University of Rome ( email )

Piazzale Aldo Moro 5
Roma, Rome 00185
Italy

Anna Attias

Sapienza University of Rome ( email )

Piazzale Aldo Moro 5
Roma, Rome 00185
Italy

Zoltan Varga

affiliation not provided to SSRN ( email )

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