Wolfgang Nagl

A Fragile Pillar: Statutory Pensions and the Risk of Old-age Poverty in Germany

The statutory pension system is the most important source of income for senior citizens in Germany. Due to increasing disruptions in employment biographies since the 1970s and due to the mass unemployment in eastern Germany since the 1990s, there is a growing fear of postretirement poverty in Germany. We develop a microsimulation model to compare the distribution of statutory pension incomes for new retirees in 2020 with the incomes of new retirees in 2004. The pension income distribution is calculated for eastern and western Germany separately, for men and women, and for different skill levels. Throughout Germany, we find growing postretirement poverty, especially among low-skilled workers. Eastern Germany will lose its current advantage in high pensions and low inequality.

Unemployment Compensation and Wages: Evidence from the German Hartz Reforms

Summary Using the introduction of fixed unemployment assistance in Germany in 2005 as a unique natural experiment, we find strong evidence that decreased unemployment compensation has an adverse effect on wages. We use micro panel data to identify and estimate the effect of this structural break. In eastern and western Germany, the relative effect is higher for women. In western Germany, the relative effect increases with skill level. In eastern Germany, there is no clear skill-specific pattern.

Explaining Spatial Patterns of Foreign Employment in Germany

ABSTRACT This paper investigates the main determinants of the representation of foreign employees across German regions. Since migration determinants are not necessarily the same for workers of different nationalities, spatial patterns are explained not only for total foreign employment but also for the 35 most important migration countries to Germany. Based on a total census for all 402 German districts, the paper starts by showing the spatial distributions of workers with different nationalities and explains the emerging patterns by spatial error models. Although large heterogeneity in determinants across nationalities are found, similarities between country groups prevail. Economic conditions matter for most nationalities, whereas the importance of amenities and openness differ.

Umverteilung in verschiedenen Pensionssystemen für Österreich

Zusammenfassung2004 wurde in Österreich das Allgemeine Pensionsgesetz beschlossen, das die gesamte Erwerbsbiografie zur Berechnung der Pensionen heranzieht. In diesem Beitrag simulieren die Autoren vier verschiedene Szenarien, um die Umverteilungsströme im österreichischen Pensionssystem in Abhängigkeit vom gewählten System zu analysieren. Einen besonderen Fokus legen sie schließlich darauf, die implizite Umverteilung innerhalb des Systems von der expliziten Umverteilung, z.B. aufgrund von Kindererziehungszeiten, zu trennen.AbstractUsing a state-of-the-art microsimulation model, we analyse the redistributional effects of four different pension systems for Austria: the status quo, the new pension account system (APG), and two versions of a Notional Defined Contribution (NDC) system — one with and the other without non-contribution-based pension benefits. We identify the largest redistribution in the status quo. Women, low-income earners and persons with limited years of contributions benefit the most. The redistribution is reduced in the APG and nearly eliminated in the NDC system. We disentangle implicit and explicit redistribution in the APG system. The relative share of implicit redistribution decreases with income, whereas the absolute value of redistribution increases.

Better Safe than Sorry? The Effects of Income Risk and Unemployment Risk on Wages

We study the effects of income risk and unemployment risk on individual wages simultaneously. Starting point for the empirical analysis is a portfolio model for the labor market. This model shows positive wage effects for both risks but also a negative interaction effect. Using German administrative panel data we estimate the effects of the income risk, the unemployment risk and their interaction on individual wages separately for men and women in East and West Germany. We find the expected positive wage effects for both risks as well as a negative interaction effect. The marginal effect of income risk on wages is positive, whereas the marginal effect of unemployment risk is negative.

Unemployment Compensation and Wages: Evidence from the German Hartz Reforms – Reply

Using the introduction of fixed unemployment assistance in Germany in 2005 as a unique natural experiment, we find strong evidence that decreased unemployment compensation has an adverse effect on wages. We use micro panel data to identify and estimate the effect of this structural break. In eastern and western Germany, the relative effect is higher for women. In western Germany, the relative effect increases with skill level. In eastern Germany, there is no clear skill-specific pattern.

Drei Irrtümer über die gesetzliche Rente

ZusammenfassungDie Öffentlichkeit unterliegt drei Irrtümern in Hinblick auf die gesetzliche Rente: Es wird behauptet, dass die Rente mit 67 rentenkürzend wirkt, dass die Renten im Osten Deutschlands geringer sind als im Westen, und dass eine Ausweitung der Beitragsbemessungsgrenze die Finanzierungsprobleme der Gesetzlichen Rentenversicherung löst. All diese Irrtümer stellen die Autoren richtig.AbstractIn the public debate on old-age poverty in Germany there are three often-heard preconceptions about the statutory pension system: first, raising the legal retirement age to 67 automatically leads to lower pensions. Second, the average level of statutory pension is lower in Eastern Germany. Third, an expansion of the social contribution ceiling would improve the financial situation of the statutory pension system. In this study, we clarify and discuss these three preconceptions.