Skip to Main content Skip to Navigation
Journal articles

Sustainability of the French first pillar pension scheme (CNAV): assessing automatic balance

Abstract : In this paper, we apply two types of automatic balance mechanism (ABM) to the French first pillar pension system for private sector employees (CNAV). One is based on a tax gap ratio (TGR-ABM) and the other is the smooth ABM (S-ABM) developed by Gannon, Legros and Touzé (2013). Two long-run forecast scenarios over the period 2014-2063 are analysed. The first is optimistic (“benchmark”) and assumes a 4.5% unemployment rate and a 1.5% productivity growth rate in the long run. The second is more pessimistic (“prudent”), with a 7.5% unemployment rate and a 1% productivity growth rate in the long run. For the benchmark (respectively prudent) scenario, a TGR-ABM requires, now and for the next 50 years, a 2.8% (respectively 6.3%) decrease in pensions and a 2.9% (respectively 6.7%) increase in the tax rate. An S-ABM requires, for the benchmark (respectively prudent) scenario, an immediate 1.5% (respectively 3.6%) decrease in pensions and a 1.4% (respectively 3.5%) increase in the tax rate. In the long run (50 years), an S-ABM requires a 4.5% (respectively 9.1%) reduction in pensions and a 4.5% (respectively 9.1%) increase in the tax rate.
Document type :
Journal articles
Complete list of metadata

https://hal-sciencespo.archives-ouvertes.fr/hal-03460192
Contributor : Spire Sciences Po Institutional Repository Connect in order to contact the contributor
Submitted on : Wednesday, December 1, 2021 - 5:18:34 AM
Last modification on : Monday, May 9, 2022 - 3:54:07 PM

File

2014-gannon-hamayon-legros-tou...
Publisher files allowed on an open archive

Identifiers

Citation

Frédéric Gannon, Stéphane Hamayon, Florence Legros, Vincent Touze. Sustainability of the French first pillar pension scheme (CNAV): assessing automatic balance. Australian Journal of Acturial Practice, 2014, 2, pp.33 - 45. ⟨hal-03460192⟩

Share

Metrics

Record views

3

Files downloads

2