The Chilean model |
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| Authors: | José Piñera |
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| Institution: | JoséPiñera has a Ph.D. from Harvard. He is President of the International Centre for Pension Reform and Co-Chairman of the Cato Project on Social Security Privatisation. As Secretary of Labour and Social Security from 1978 to 1980, he was responsible for the privatisation of the Chilean pension system. |
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| Abstract: | In 1981, Chile replaced its government-run pay-as-you-go pension system with a national system of individual Pension Savings Accounts managed by the private sector. The new system has contributed to the increase in the country's savings rate, the productivity of capital and the rate of economic growth. More important, Chilean workers now have property rights over their own pension contributions and enjoy much higher pensions than under the old system. |
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