Communicating Social Security Reform

Søren Leth-Petersen, Andrew Caplin, Eungik Lee and Johan Saeverud
Additional contact information
Andrew Caplin: Department of Economics, New York University, NBER and Center for Economic Behavior and Inequality (CEBI)
Eungik Lee: Department of Economics, New York University
Johan Saeverud: Department of Economics and Center for Economic Behavior and Inequality (CEBI), University of Copenhagen

No 22-19, CEBI working paper series from University of Copenhagen. Department of Economics. The Center for Economic Behavior and Inequality (CEBI)

Abstract: Despite its centrality in monetary policy, communication is not a focus in social security reform. We investigate the potential for active communication to dissipate apparently widespread public confusion about the future of social security. We implement a simple information treatment in which we randomly provide survey respondents access to the longevity-based eligibility age implemented by reform that Denmark launched in 2006. Absent treatment, younger workers not only have biased beliefs, expecting to become eligible for social security earlier than policy makers intend, but also are highly uncertain about eligibility age. The information treatment eliminates the bias, suggesting it results from misunderstanding. Yet it has no influence on uncertainty, suggesting this is driven by unavoidable demographic and political uncertainties. Our results highlight the value of communication strategies and belief measurement as policy instruments outside the monetary policy arena.

Keywords: social security; belief updating; information treatment; policy uncertainty (search for similar items in EconPapers)
JEL-codes: D8 H55 J26 (search for similar items in EconPapers)
Pages: 37
Date: 2022-10-03
New Economics Papers: this item is included in nep-age, nep-cba and nep-pbe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Communicating Social Security Reform (2022)
Working Paper: Communicating Social Security Reform (2022)
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