Do universal non-contributory old-age pensions make sense for rural areas in low-income countries?

Abstract

The need for old-age security coverage in rural areas of many developing countries is rapidly increasing for several reasons, including population ageing and the weakening of family support networks. These trends have generated intense interest in policies that might help respond to the growing problem of rural old-age destitution. The focus of our analysis is on one of the most promising alternatives under consideration: universal non-contributory old-age pensions. This model has some limitations and it is not appropriate for all developing countries, but it would be of potential benefit to far more than the six that have already implemented variants of this approach.