Finance

Emigration

Business

Biology

Economic policy

Political science

Econometrics

Economics

Ecology

European union

Pension system

Member states

Pension

Sustainability

Financial system

Panel analysis

Panel data

Economics & Sociology

The paper brings the analysis of the emigration effects on financial and political sustainability of pension systems in 11 new European Union member states: Bulgaria, Estonia, Croatia, Latvia, Lithuania, Poland, Romania, Slovak Republic, Czech Republic, Slovenia and Hungary.The panel data analysis (fixed effects model) covers the crisis and post-crisis period from 2008 to 2017.The obtained results show that emigration growth is positively related to the pension expenditures (expressed as a share in GDP), thus having a negative impact on financial sustainability of pension system.On the other side, the emigration effect on social sustainability of pension system which is encompassed by the median relative income (65+) is not statistically significant.However, through including other socio-economic and political factors in econometric models besides the emigration (e.g.unemployment rate, education, political cycles, old-age dependency ratio, replacement ratio), the results have confirmed that there is a trade-off between the two goals of pension policies, i.e. between financial and political sustainability of pension system.

The effect of emigration on financial and social pension system sustainability in EU new member states: Panel data analysis