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Medium and long-term effects of tax and pension reforms

Pension modelling system plan
Pension mondelling Euro
@bilderstoeckchen– Adobe

This project aims at studying the effects of pension reforms in EU Member States. The focus is on the macroeconomic, redistributive, and fiscal sustainability effects in the medium- to long-term. 

The main tool is the EDGE-M3 overlapping generations (OLG) model. The model is designed to study the impact of fiscal reforms, including pension tax reforms. It accounts for individual behavioural responses and simulates both the macroeconomic and distributional effects of reforms. The model is well-suited to conduct welfare analyses of alternative public policy proposals. 

The EDGE-M3 model has a number of key strengths for this area of analysis. First, there is a detailed and accurate modelling of the national old-age pension systems, including the accumulation of pension claims. Second, there is rich heterogeneity in labour market prospects across the population. This allows for consistent analyses of the impact of simulated reforms across EU Member States and population subgroups. 

Explore EDGE - M3


Rocío Fernández Bastidas

Jonathan Pycroft

Balàzs Parkanyi

Javier López Segovia

Dušan Stojanović

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