Mackellar et al in Helsinki

I lliked especially Mackellar et al.'s Helsinki paper. It's - mind you - a
very neoclassical technical model, with the following result:

Globalization is likely to erode the pension income of older persons in the
center, but  it will enhance their wealth and their incomes from capital,
leaving their overall spending power slightly improved, but with
inequalities between the elderly sharply rising (i.e. those, whose pensions
are based on schemes exclusively involving wage incomes during their work
life against those, whose pension incomes are based on capital). The working
age population which earns lower wages as a result of having less capital to
work with (capital is increasingly invested in the periphery and
semi-periphery) is an unambigious loser from the globalization process.
Globalization furthermore will redistribute from lifetime non-savers
(especially the poor in the center countries, who depend on labor income
while being young and wage-based transfers when being old) to the lifetime
savers, who will be able to take advantage of improved capital returns.

Some of you might say - so what - we knew it all along! The point is
however, that this is a very neoclassical, quantitative model, written here
at the IASA think-tank in Laxenburg near Vienna.

Kind regards

Arno Tausch

MR Doz. Dr. Arno Tausch
EUI 13/EUI 12
BMSG Stubenring 1
A-1010 Wien

Tel. 71100-2272
e-mail: arno.tausch@bmsg.gv.at