How Secure Is Social Security?

Keyfitz, N. (1981). How Secure Is Social Security? IIASA Working Paper. IIASA, Laxenburg, Austria: WP-81-101

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Abstract

Sharply reduced rates of population and industrial growth have been projected for many of the developed nations in the 1980s. In economies that rely primarily on market mechanisms to redirect capital and labor from surplus to deficit areas, the problems of adjustment may be slow and socially costly. In the more centralized economies, increasing difficulties in determining investment allocations and inducing sectoral redistributions of a nearly constant or diminishing labor force may arise.

The socioeconomic problems that flow from such changes in labor demands and supplies form the contextual background of the Manpower Analysis Task, which is striving to develop methods for analyzing and projecting the impacts of international, national, and regional population dynamics on labor supply, demand, and productivity in the more-developed nations. One subtask is examining the growing problem of rising social security costs in industrialized countries. In this paper, Nathan Keyfitz observes that the problem of rising costs is likely to remain a tense issue for another half century, until by 2035 the demographic contributor to these costs will have reached a maximum and will start to decline, as the baby boom cohorts begin to die off. Keyfitz concludes his essay with a call for learning from the lessons of European experiences. Work on this topic is being directed toward that goal in the Human Settlements and Services Area.

Publications in the Manpower Analysis Task series are listed at the end of this paper.

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