C. van Ewijk

The long wave — a real phenomenon?

SummaryTo explain the decline in economic growth after the beginning of the 1970s, several authors have reverted to the theory of the 40- to 60-year-long Kondratieff cycle. This article concentrates on the empirical foundations of this cycle. After a critical survey of the important investigations by Kondratieff, Imbert and Van Duyn, the thesis of the long wave is subjected to a new test on the basis of time series of indicators of real economic growth in Great Britain, France, (West-) Germany, and the United States. The results of this investigation are clearly negative with respect to the existence of a long wave in real variables in these countries.

Designing the Pension System: Conceptual Framework

This paper develops an analytical framework for the design of pension systems, taking the functions of the pension system as the guiding principle. It discusses the economic principles underlying these functions and their implementation in practice. In particular, it distinguishes three functions: facilitating life-cycle financial planning; insuring idiosyncratic risks and sharing macroeconomic risks across generations. The first function concerns consumption smoothing over the life cycle, taking into account individual circumstances and preferences. The second function concerns pooling of intragenerational risks in the face of imperfect insurance markets. The third function concerns intergenerational risk sharing of systemic or ‘macroeconomic’ shocks in the face of incomplete markets. As regards the latter function, the relevant market imperfections are the limited tradability of human capital and the lack of markets to trade risks with future generations.