Pension reform in Latin America : distributional principles, inequalities and alternative policy options

Abstract

During the 1990s a wave of major structural reforms that changed the distributional principles underpinning pension policies spread across Latin America. Outcomes were not always as expected. The implementation of new pension rules in the socio-economic, political and institutional context of Latin America has resulted in a number of inequalities which affect pension system performance and the gains that different income groups and generations may obtain. In order to overcome the distributional drawbacks of reform, Latin American governments may need to afford a new role to non-contributive pensions, as well as consider the application of specific regulatory adjustments to reduce the risks and inequalities involved in the private pillar. Cross-border policy learning may provide useful tools to achieve these aims.