MISSAR: a dynamic microsimulation model for Argentina’s social security system

Mardi | 2020-01-21
Salle B103 16h – 17h20

Leonardo Eric CALCAGNO

Argentina’s National Social Security Administration (ANSES), the country’s main social security scheme, lacks official projections of its future expenses or income. This hinders the study of the system’s sustainability, and makes it impossible to evaluate ex ante the impact of social security reforms either on social security accounts or on its beneficiaries. This paper presents the dynamic Microsimulation model for Social Security in Argentina (MISSAR): its general architecture, input datasets, most relevant methodological choices and a token of its projection results. MISSAR simulates social security contributions as well as ANSES most important social security benefits: retirement benefits, survivors’ pensions and family benefits. To do so, MISSAR not only models individual labour-market income and transitions; it also simulates socio-demographic behaviour (including birth, death, unions, divorce or household composition) and education. MISSAR first takes one wave of Argentina’s Permanent Household Survey (EPH) and simulates past individual careers that are consistent with the respondents’ characteristics, estimating individual retirement rights. Then, MISSAR projects the starting population’s evolution up to 2040, following economic, demographic and pension reform scenarios. Thus, MISSAR can gauge the impact of pension reforms on ANSES future economic and political (its benefits adequacy, coverage and redistributive impact) sustainability. Using MISSAR, we showed in Calcagno (2018) that Argentina’s 2016 and 2017 pension reforms will not only increase ANSES deficit between 2.5% and 4% of GDP by 2022, but that they also reduced the system’s adequacy and redistributive impact.