| Abstract: |
This paper examines the microeconomic impact of a reform of a Czech pension system in which the program is at least partially shifted from a public, unfunded basis to a private, funded basis. It consideres three different scenarios in which individuals have the opportunity to switch part of their mandatory contributions into a funded scheme in exchange for a proportionate reduction in their traditional public pension benefits. It attempts to estimate which workers would be better off switching based on gender, age and income, and some recommendations for policy makers are given. In particular, the impact of mandatory switching on individuals with a low earning capacity is examined and discussed.
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