Individual savings accounts for social insurance: rationale and alternative designs

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Using Danish data, we find that about three-fourths of the taxes levied to finance public transfers actually finance benefits that redistribute income over the life cycle of individual taxpayers rather than redistribute resources across people. This finding and similar results for other countries provide a rationale for financing part of social insurance via mandatory individual savings accounts. We discuss the advantages and disadvantages of mandatory individual savings accounts for social insurance and survey some recent alternative proposals for such accounts
Original languageEnglish
JournalInternational Tax and Public Finance
Volume15
Issue number1
Pages (from-to)67-86
Number of pages20
ISSN0927-5940
DOIs
Publication statusPublished - 2008

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