Welfare regimes for ageing populations: divergence or convergence?

Mehmet F Aysan, University of Western Ontario

We consider the reform of pension policies in OECD countries in light of both demographic ageing and path dependency associated with welfare regime type (Liberal, Social Democratic, Continental, and Southern European). These regime types represent differential responsibility for social security on the part of market, the state, and family. While there are significant differences in labor market characteristics, the demographic similarities in ageing bring similar pressures for pension reforms across various OECD countries. The reforms, nonetheless, take somewhat different forms: Social Democratic countries have focused on cost containment and recalibration of their pension systems in a universalistic system; countries with Liberal welfare regimes have focused on placing more responsibility on a private tier; Continental and Southern European welfare states have focused on cost containment, recalibration and re-commodification. We can conclude that there is no single path for pension reforms, and welfare states tend to follow their traditional paths with some variations.