A Quarter Century of Pension Reform in Latin America and the Caribbean: Lessons Learned and Next Steps

Contents......Page 5
Acknowledgments......Page 7
Foreword......Page 9
SECTION ONE: Overview......Page 11
The Motivation for Reform......Page 13
Design Considerations......Page 17
Institutional Structure for Reform: Some Prerequisites for Success......Page 26
Fiscal Discipline and Sustainability......Page 30
Financial Considerations......Page 36
References......Page 48
SECTION TWO: Structural Reform Dilemmas......Page 51
CHAPTER 2 Evaluation of a Quarter Century of Structural Pension Reforms in Latin America......Page 53
Key Concepts and Description of the Reforms......Page 54
The Structural Pension Reforms......Page 57
References......Page 88
CHAPTER 3 Fiscal and Institutional Considerations of Pension Reform: Lessons Learned from Chile......Page 93
The Pension System before the 1980 Reform......Page 95
Overview of the 1980 Pension System Reform......Page 97
The Pension System Transition......Page 99
The Welfare-based, Noncontributory Pension System (the PASIS)......Page 116
Institutional Effects of the Pension Reform......Page 120
Fiscal Effects of the Pension Reform......Page 122
Conclusion......Page 130
References......Page 133
CHAPTER 4 A Needs Assessment of Pension Systems in the English-Speaking Caribbean......Page 137
Economic and Social Conditions in the Region......Page 138
The Region’s Social Security Systems......Page 143
Unresolved Issues and Main Needs......Page 152
Annex 4.2. Questionnaire: Status of and Expectations for National Pension Systems......Page 166
References......Page 171
SECTION THREE: Parametric Reforms as an Alternative Model......Page 173
CHAPTER 5 Public and Private Roles in Pension Reform: An International Comparison......Page 175
The Reform Debate......Page 176
Private Management Models......Page 185
Management Models and Contribution Rates......Page 187
Management Models and Benefit Predictability......Page 189
Comparison of Models......Page 193
References......Page 194
CHAPTER 6 The Politics of Pension Reform in Brazil......Page 197
The Logic of Collective Action in Pension Reform......Page 200
Concentrated Benefits and Diffused Costs: The Evolution of Brazil’s Pension System......Page 204
Concentrated Costs and Diffused Benefits: Pension Reform......Page 207
Conclusions......Page 222
References......Page 225
SECTION FOUR: Reinforcing Reforms in the Region......Page 227
The Success of Chile’s Model......Page 229
Aspects of the Reform that Merit Special Attention......Page 230
Difficulties with the Reforms......Page 233
Multifondos: Better Risk Profiles, More Valuable Information......Page 236
The Annuities Law and the SCOMP......Page 239
The Ongoing Reform Agenda......Page 243
References......Page 248
The Mexican Pension Reform......Page 251
Importance of Retirement Saving and its Regulation......Page 252
The Investment Framework......Page 254
Prudential Regulation......Page 275
Risk-based Supervision......Page 281
Concluding Remarks......Page 283
References......Page 285
CHAPTER 9 The Impact of Argentina’s Economic Crisis on its Pension System......Page 287
The History of the Argentine Pension System......Page 288
The Crisis......Page 296
The Effect of the Crisis on the Pension System......Page 301
Short- and Long-Term Effects of the Crisis......Page 305
An Agenda for the Future......Page 307
Conclusion......Page 312
References......Page 313
CHAPTER 10 Annuities and Pension Reform: Main Issues in Devloping Countries......Page 315
Annuities: An Overview......Page 317
Brief Literature Review......Page 318
Annuity Designs and Uncertainties......Page 319
Annuity Markets in Latin America and the Caribbean......Page 327
References......Page 344
SECTION FIVE: The Pension Industry Point of View......Page 349
CHAPTER 11 Agenda for the Reform of Pension Systems in Latin America......Page 351
The Chain of Production of Pension Systems......Page 352
The Agenda for Reforms......Page 355
Cost of Managing Processes Assigned to AFPs......Page 376
Conclusions: Toward a New Agenda......Page 381
Bibliography......Page 384
Introduction and Methodology......Page 385
The Global Financial Well-being Study......Page 387
Detailed Report of Findings......Page 390
A Call to Action......Page 413
About the Authors......Page 415