Welfare Gains from a Capital Market Union with Capital-Funded Pensions

  • Thomas Davoine
  • Susanne ForstnerEmail author
Part of the Financial and Monetary Policy Studies book series (FMPS, volume 48)


We analyze and compare the long-run effects for a country introducing a capital-funded pension pillar in two scenarios: The case of separate capital markets, on the one hand, and the case of integrated capital markets (a capital market union), on the other hand. Our analysis is based on simulations with a large-scale overlapping-generations model. We find that, in the long run, the introduction of capital-funded pensions is more attractive in integrated capital markets than in separated capital markets, if other countries in the integrated capital market have pay-as-you-go pension systems.


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Copyright information

© Springer Nature Switzerland AG 2019

Authors and Affiliations

  1. 1.Institute for Advanced Studies (IHS)ViennaAustria

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