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Is there a political support for the double burden on prolonged activity?
Economics of Governance (2006)
  • Georges Casamatta
  • Helmuth Cremer
  • Pierre Pestieau
Abstract

In many countries elderly workers are subject to a double distortion when they consider prolonging their activity: the payroll tax and a reduction in their pension rights. It is often argued that such a double burden would not be socially desirable. We consider a setting where it would be rejected by both a utilitarian and a Rawlsian social planner. Furthermore, each individual would also reject it as a citizen candidate. We show that the double burden may nevertheless be (second-best) Pareto efficient and can be supported by a particular structure of social weights biased towards the more productive workers.

Disciplines
Publication Date
May, 2006
Citation Information
Georges Casamatta, Helmuth Cremer and Pierre Pestieau. "Is there a political support for the double burden on prolonged activity?" Economics of Governance Vol. 7 Iss. 2 (2006)
Available at: http://works.bepress.com/georges_casamatta/9/