Application of Automatic Balance Mechanism into the PAYG  Cover Image

Uplatnenie automatického vyrovnávacieho mechanizmu v priebežnom pilieri dôchodkového systému v Slovenskej republike
Application of Automatic Balance Mechanism into the PAYG

Author(s): Ján Šebo, Tomáš Virdzek
Subject(s): Economy
Published by: Ekonomický ústav SAV a Prognostický ústav SAV
Keywords: PAYG system; balance sheet; automatic balance mechanism; political risk

Summary/Abstract: Article deals with the existence and functioning of automatic balance mechanism (ABM) in the PAYG pension systems. By uncovering theoretical knowledge on ABM, we focus on its ability to overcome political risks and to stabilize the PAYG system in short and long run without drastic shock interventions, which are politically unstable. Further, we created and applied the ABM model into specific conditions of Slovak PAYG system and found its ability to balance PAYG system on cash and accrual basis. At the same time, we propose inevitable steps and changes in order to implement the model into practice and legislation.

  • Issue Year: 60/2012
  • Issue No: 05
  • Page Range: 482-494
  • Page Count: 13
  • Language: Slovak