Pension privatization in crisis: Death or rebirth of a global policy trend?

Abstract

From 1981 to 2007, more than thirty countries worldwide fully or partially replaced their pre-existing pay-as-you-go pension systems with ones based on individual, private savings accounts in a process often labelled “pension privatization”. After the global financial crisis, this trend was put on hold for economic, ideational, and institutional reasons, despite a rise in critical indebtedness that has facilitated pension privatization in the past. Is the global trend towards pension privatization dead or in the process of being reborn, perhaps in a somewhat different form? Several recent trends point to rebirth as policy-makers scale back public and private pension systems, attend to minimum pensions and “nudge” rather than mandate people to save for retirement.