Insights from the OECD’s Pensions at a Glance 2017

On December 5th, the OECD published its biennial flagship publication Pensions at a Glance. The 2017 edition again provides a trove of interesting data; here are a few highlights from this year’s survey (all figures below are from OECD Pensions at a Glance 2017). [Read more…]

Global Economy: Headed in the Wrong Direction

This week, the OECD released its Economic Outlook for November 2015, revising 2016 real GDP growth in the OECD area downward from 2.5% to 2.2%, following its June 2015 report. The OECD noted a collapse in import volumes in emerging markets (especially China), and the sort of slowdown in global trade growth that has historically accompanied recessions. Real fixed investment was again disappointing, and the OECD once more pleaded with countries to take advantage of low interest rates and increase public infrastructure investment, in part to tackle climate change.

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Pension Funds, Financialization, and Lacklustre Investment

In recent debates over the reform of national pension systems, and especially the shift from pay-as-you-go (PAYGO) financing of public pensions to pre-funded arrangements, the labour movement has repeatedly stressed an important point. Regardless of whether pension costs are borne by contributors when benefits are paid or when they are accrued, future pension benefits are a claim on future production, and are ultimately paid out of future national income. That is, no matter how the pension scheme is financed today, future retirees’ consumption will be supported by allocating a portion of future output and income to pensioners.

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OECD: World Economy Stuck in a Low-Growth, Low-Investment Equilibrium

This week, the OECD released its twice-yearly Economic Outlook. Following the contraction of the Canadian and US economies in the first quarter of 2015, what was the weakest period of global growth since the Great Recession, the OECD downgraded its forecast for global growth to 3.1% in 2015, from 3.7% projected last November. Six years into the “recovery,” 40 million people in the OECD remain unemployed, 7.5 million more than the pre-crisis peak. The unemployment rate remains above 11% in the Eurozone. Summing up the global economy, the OECD writes, “in effect, many economies have become stuck in a low-growth and low-investment equilibrium, with persistent unemployment, stagnant wages, and non-robust consumption.”

[Read more…]

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