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Evaluation of four decades of pension privatization in Latin America, 1980 - 2020: Promises and reality

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After almost 40 years of experience with privatized pension systems in Latin America, it is possible to evaluate the great promises that were made at the time when state pay-as-you-go systems, often in crisis, were replaced. As will be seen in the text, the evidence is not positive, at least not from the point of view of most workers. The negative results have led several countries to carry out or are discussing reforms, with the aim of cushioning the effects of the logic of their operation in an environment of social segregation based on the labor market and the concentration of income that translates directly into insufficient old-age pensions for the great majority of working people. Carmelo Mesa-Lago dedicated part of his analysis to the privatization experiment, gathering the evidence and the performance of private pension systems, based on the promises of their advocates, in the nine Latin American countries that adopted them, analyzing the results of the reforms in four countries and the current reform proposals in two others, as well as the situation of the largest pay-as-you-go system in the continent, Based on the conclusions of the analysis, it presents a series of recommendations that derive from a flexible and not a single model orientation for a reform that meets the criteria of social security and social justice. (AU)
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