NEXT GENERATION OF INDIVIDUAL ACCOUNT PENSION REFORMS IN LATIN AMERICA by ProQuest

VIEWS: 12 PAGES: 43

More Info
									Next GeNeratioN of iNdividual accouNt PeNsioN
reforms iN latiN america
by Barbara E. Kritzer, Stephen J. Kay, and Tapen Sinha*

Latin America led the world in introducing individual retirement accounts intended to complement or replace
defined benefit state-sponsored, pay-as-you-go systems. After Chile implemented the first system in 1981, a
number of other Latin American countries incorporated privately managed individual accounts as part of their
retirement income systems beginning in the 1990s. This article examines the subsequent “reform of the reform”
of these pension systems, with a focus on the recent overhaul of the Chilean system and major reforms in Mexico,
Peru, and Colombia. The authors analyze key elements of pension reform in the region relating to individual
accounts: system coverage, fees, competition, investment, the impact of gender on benefits, financial education,
voluntary savings, and payouts.


Introduction                                                            accounts. We pay special attention to Chile, which
                                                                        is the region’s pioneer in pension reform; however
By the year 2000, several countries in Latin America
                                                                        we also analyze major reforms in Mexico, Peru, and
had followed Chile’s lead in setting up individual
                                                                        Colombia.1 Specifically, and as described briefly in
retirement savings accounts intended to complement
                                                                        the remainder of this introduction, this article ana-
or replace defined benefit, state-sponsored pension
                                                                        lyzes key elements of pension reforms that feature
systems (Sinha 2000; Kay and Kritzer 2001). Over the
                                                                        individual accounts, including system coverage,
past decade, the world has continued to look to Latin
                                                                        fees, competition, investment, the impact of gender
America as these maturing pension systems confront
                             
								
To top