One of the Best Pension Systems in the World?

Nordheim, Fritz von; Kvist, Jon

doi:10.1108/978-1-80043-712-820221011

Cited by 3 publications

(4 citation statements)

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“…A broad international literature indicates that health and remaining working capacity tend to improve at a markedly slower rate than average life expectancy. Consequently, we have elsewhere argued that a life expectancy indexing of the pensionable age like the Danish will increase social inequality among older workers and pensioners since the ability to postpone retirement and work longer—as well as remaining life expectancy itself—are very unequally distributed among occupations and across individuals (von Nordheim & Kvist, 2022a, 2022b). Similarly, we have suggested that the economic benefits of raising the pensionable age will decrease as the age go up and that certain age thresholds may prove difficult to transcend for social as well as biological reasons.…”

Section: The Implicit Understanding Of Retirement In the Various Refo...mentioning

confidence: 99%

“…3.4. Denmark tightens and advances the timing of its retirement reform while also backtracking Following the economic crisis of 2008-2010, a majority in the Danish Parliament in 2011 decided to further limit access to VERPS while also moving the implementation of the other elements of the 2006 reform agreement 5 years forward (Finansministeriet, 2011; see von Nordheim & Kvist, 2022a, von Nordheim & Kvist, 2022b.…”

Section: With the Rise In Exit Ages Likely To Fall Behind Life Expect...mentioning

confidence: 99%

“…The article concludes by discussing the implications of the Nordic experiences for reforms that seek to make people retire later. Pension reforms obviously have many aspects and a wealth of economic and social implications, but the focus of this article is limited to experiences with mechanisms aimed at extending working lives in line with developments in life expectancy (for a broader view of the effects of pension reforms see e.g., von Nordheim & Kvist, 2022a, von Nordheim & Kvist, 2022b).…”

Section: Introductionmentioning

confidence: 99%

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Regulating the retirement age—Lessons from Nordic pension policy approaches

Nordheim

Kvist

2022

Regulation & Governance

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The likelihood that longevity will continue to increase has generated a search for regulation that make people work longer as they live longer, and thus not just containing pension expenditure but also enlarging labor supply, economic growth, and tax revenue. In public pension policy, Nordic countries have led the world with three types of approaches aimed at making people retire later. The first came when Sweden, followed by Finland and Norway, installed life expectancy coefficients in benefit calculation formulas. The second followed as Finland introduced age-related accrual rates and the third when Denmark indexed the pensionable age to developments in life expectancy. Since economic incentive-based regulations failed to raise exit ages sufficiently, Finland and Sweden subsequently linked pensionable ages to life expectancy like Denmark. While this policy brings out inequalities in health and workability, the fact that countries found it necessary to index the pensionable age to longevity instead of just relying on economic incentives in regulating retirement behavior may hold lessons for other countries.

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Section: The Implicit Understanding Of Retirement In the Various Refo...mentioning

confidence: 99%

Section: With the Rise In Exit Ages Likely To Fall Behind Life Expect...mentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Regulating the retirement age—Lessons from Nordic pension policy approaches

Nordheim

Kvist

2022

Regulation & Governance

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“…¹ For an extensive introduction to the history and design of the Danish pension system, please see vonNordheim and Kvist (2022).…”

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Successful Public Policy in the Nordic Countries

2022

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This book presents 23 in-depth case studies of successful public policies and programmes in Sweden, Denmark, Finland, Norway and Iceland. Each chapter tells the story of the policy’s origins, aims, design, decision-making and implementation processes, and assesses in which respects—programmatically, process-wise, politically and over time—and to what extent it can be considered a policy success. It also points towards the driving forces of success, and the challenges that have had to be overcome to achieve it. Combined, the chapters provide a resource for policy evaluation researchers, educators and students of public policy and public administration, both within and beyond the Nordic region.

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‘Living Longer, Working Longer’

Nordheim¹,

Kvist²

2022

Successful Public Policy in the Nordic Countries

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With the Danish life expectancy indexing of pensionable ages as case, this chapter examines to what extent a policy that objectively can help avoid recurrent conflicts as well as large economic and social challenges, can be deemed a success, even though it fits poorly with the PPPE model, as it was adopted, tightened, and continued without involving major stakeholders, and is neither fair nor popular. After briefly introducing the demographic challenges to pensions and explaining the positive potential of linking the pensionable age to developments in longevity, the chapter presents the paradoxes of the Danish case. In 2006 Denmark was a rather unlikely candidate to take a vanguard position in pension reform. Its economic situation and the fiscal health of the pension system in no way necessitated such a policy. Raising the pensionable age did not fit the priorities of most of the political parties that supported its initiation. Even more remarkable: the policy was tightened in 2011 by a government in which the main parties had campaigned against it and it was first implemented (2014) and later continued (2020) by other reluctant governments. Given these oddities, the focus is on explaining which constellation of circumstances and actors allowed such a novel pension policy to be adopted and continued, how this conditioning affected its design, implementation and longer-term effects, and assessing to what degree and in what ways it has been, is and may continue to be a ‘successful’ policy in certain dimensions.

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One of the Best Pension Systems in the World?

Cited by 3 publications

References 4 publications

Regulating the retirement age—Lessons from Nordic pension policy approaches

Regulating the retirement age—Lessons from Nordic pension policy approaches

Successful Public Policy in the Nordic Countries

‘Living Longer, Working Longer’

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