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Strengthening Market Principles in Welfare Institutions: How Hybrid Pension Systems Impact on Social-risk Spreading

Published online by Cambridge University Press:  19 July 2013

PATRICIA FRERICKS
PATRICIA FRERICKS*
Affiliation:
Sociology/Center for Globalisation and Governance (CGG), Hamburg University, Allende-Platz 1, D – 20146 Hamburg email: [email protected]
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Abstract

In the past two decades, the question of how pension systems should be designed to offer ‘adequate and sustainable pensions for all’ has been raised. As a result, European pension systems, in which market principles in general have played a marginal or even negligible role in the past, were redesigned, with market-based pensions becoming part of the pension calculation norm, i.e. the institutionalised and nationally defined target level for old-age protection. However, since the hybrid pension systems are institutionalised very differently, pension systems’ ingredients, characteristics and nexus are far from being homogeneous, and the role of market principles in hybrid systems differs. These differences significantly determine the degree of social protection of the various social citizens and the number of future pensioners with adequate pensions. An illustrative comparison of the contrasting Dutch and German institutional setups indicates differences in the manner in which market principles have been strengthened in the pension system, and the related effects these differences have on social-risk spreading.

Type
Articles
Information
Journal of Social Policy , Volume 42 , Issue 4 , October 2013 , pp. 665 - 683
Copyright
Copyright © Cambridge University Press 2013 

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