Pensions and Social Inclusion in Three ex-Yugoslav Countries: Slovenia, Croatia and Serbia

Abstract

Building upon the research by Meyer et al. (2007), this study employs risk biographies to evaluate how three ex-Yugoslav pension systems cope with the social exclusion of the elderly. The article simulates pension entitlements in Slovenia, Croatia and Serbia and comes to two broad conclusions. First, the three pension systems that originated from a common legislative base, albeit in countries with marked differences in economic development, now diverge in almost every aspect. Hence, further research should analyse the entire retirement microcosm of the former Yugoslavia and delve deeper into the mechanisms of pension system evolution. Second, the study expounds the pros and cons of the three schemes and argues that none can avoid further reforms. Slovenian public pensions are excessively generous and consequently require fiscal cuts, the Croatian funded tier is too small to complement lower public benefits, and the Serbian arrangements should be a temporary sacrifice to cope with fiscal austerity. The paper complements a traditional overview of the three systems by analysing the problems of each risk biography. It concludes by giving a number of prescriptive recommendations for the future well-being of the elderly in the region.