How Would you Like to Reform Your Pension System? The Opinions of German and Italian Citizens

Pension reform, while urgent, proves politically very difficult. Continuing a recent line of research, this paper sheds light on the nature of these difficulties by analyzing the citizens' opinions on different aspects of pension reform. We report on the results of two surveys conducted in Germany and Italy in Spring 2000 and Fall 2001. The surveys show that the status quo is a majoritarian outcome along many dimensions: most pension reform proposals lack a majority and reformers rarely support more than one reform option. Later retirement is the easier reform in Italy (where effective retirement age is lower), while lower pensions are more popular in Germany where the effective replacement rate is higher. Preferences over policy options seem to reflect both economic self-interest and one’s normative view about the role of the state. But there is light: opposition to reform is much lower among the informed.