Les comptes notionnels, les
femmes et l’Italie
Antoine Bozio, Institute for Fiscal Studies
NDC and the labour market in Italy
• Two papers from Tito Boeri
– “Pension Reforms and Women Retirement Plans”
(joint with Agrar Brugiavinni)
– “Is Social Security Secure with NDC?” (joint with
Vincenzo Galasso)
• Common theme
– NDC reform in 1995 in Italy
– Are pensions of women and unemployed at risk?
– Is labour market reform a necessary complement to
the NDC pension reform?
• Main proposal
– A unique labour contract should address the problem
of dual labour markets in Italy and elsewhere
“Pension Reforms and Women Retirement Plans”
• Background
– Women have more “gap years” than men
– NDC reform in 1995, from a retributive system
towards a contributive system
• Empirical method
– Dependent variable = expected retirement age
– Explanatory variables = X, gap years, Δ(Peak value)
• Results
– Gap years are significant for women
– Δ(Peak value) is higher for men
 Higher retirement elasticity of men?
 Binding eligibility constraints explain why women are
less reactive to changes in pension rules than women?
Comments
• Low retirement elasticity of women?
– Interesting result given the general result on higher
labour supply elasticity of women during life
– Other similar results on French data (Bozio 2006,
2010)
• Why is this the case?
– Authors suggest eligibility constraints
– Is there evidence that it is really eligilibity constraint
that explains lower “retirement elasticity” of women?
– Other possible explanations (joint decision in
household, income effects etc.)?
“Is Social Security Secure with NDC?”
• The paper
– Italy suffers from a dual labour market, with increasing
share of fixed term contract, with higher probability of
unemployment spells
– NDC reforms has increased the link between
contributions and pensions
=> Those who will suffer from these unemployment
spells will also suffer very reduced pensions
• Main analysis
– NDC system is fine in itself
– Interaction of NDC and dual labour market poses
problem
– Unique labour contract could resolve the dual labour
market and thus solve the issues with pensions
Comments
• Italian NDC is one of a variety
– Italian reform has not implemented many safeguards
for career breaks
– Very different from the Swedish brand of NDC
– Even without a dual labour market, this is a problem
• Does NDC really makes the dual labour market
worse – for a given level of redistribution?
– Pension rights are accrued since the start of the career
– Pension contributions are more valued by younger
workers => increased labour supply
– Lower incentives to set seniority wages
• Dual labour market does not need NDC to be
problematic