CIRCLE – JTC2016

Main contact person: Prof. Elsa Fornero – elsa.fornero@unito.it

Project website  http://circle-cerp.carloalberto.org/

Short introduction ( aim, goal of project, when did this project start?)

The aim of CIRCLE is to provide new empirical evidence of the impact of the interaction between the economic and demographic changes and the welfare systems on the distribution of the resources, rights and responsibilities between generations. In many EU countries welfare provisions addressed to older people are pay as you go financed and fast population ageing boosts redistribution from the young to the old. However compensatory mechanisms redistributing resources from the old to the young, are often implemented at intra-household level, mainly through inter-vivos transfers and informal care provisions. The analysis takes both redistributive flows into account and covers a variety of EU welfare state models, giving a strong base for generalizing the results and deriving useful policy implications. The project officially started on March 15, 2017 and will last 3 years

What kind of impact on the society is expected?

The study will:

a) contribute to the debate on the redesign of the European welfare states as it:

  • highlights both intergenerational income redistributive flows and monetary and in kind compensating transfers occurring at intra-household levels. Intra-household solidarity and insurance of the many life-cycle risks can on the one hand compensate the shortcomings of the welfare state in a period in which there is scarcity of resources and, on the other hand, counterbalance the excess redistribution operated by current welfare regime in favour of the older generations and detriment of the young generations. To explore to what extent these compensation mechanisms operates in different European countries is interesting and useful for redesigning properly the future welfare systems (Work Package 1 and 2).
  • clearly states the criticalities related to the individuals’ understanding of the welfare state functioning and reforms. Enhancing the comprehension of the welfare state institutions functioning can prevent individuals to improperly undertake behaviours addressed to neutralize the effects of the reforms (Work Package 3).
  • takes a cross-countries perspective that enhances knowledge based proposals for policy reforms.

b) addresses issues related to “soften intergenerational conflicts”. Many institutions of the welfare state are pay as you go financed and base their functioning on an implicit pact among generations. Short term myopic behaviour of governments together with the general ageing process and the reduction in the economic growth contributed to make them financially unsustainable in the long term. Heavy implicit debt has been accumulated on the shoulders of future generations and can potentially determine important intergenerational conflicts. The project sheds light on the redistributive patterns across generations in order to clarify the respective positions and “soften intergenerational conflicts”.

c) contributes to the debate on social mobility and on its links with equity addressing the following questions: What happens to social mobility in these last years? How social mobility correlates with redistribution in European countries? What is the role of welfare state institutions and of family ties in determining mobility?

Which phase of your project are you at the moment? 

The project is just in the beginning phase. Nevertheless, the research group had a kick off meeting on March 24 in Antwerp, where preliminary ideas on “Redistributive effects of tax expenditures on pension savings in EU” (WP1) and “Old age support for children? Combating child poverty through pension benefits in extended families” (WP2) were presented. The group also appointed a scientific committee who will advise on the project output. We also set up a website for disseminating the project output

Did  you already get any preliminary results?

No, given the late start of the project.

What are the phases planned for the immediate future? 

According to the working plan, slightly amended during the kick-off meeting, the research group is actively working on Task 1.2, 1.3, 2.1, 2.4 and 3.1.

Task 3.1 already required a large exchange of information with the SHARE Project Coordination and the SHARE national teams and at the moment the feasibility of running a drop-off module of SHARE as part of the CIRCLE project is being carefully examined, due to some unexpected changes in the timing of SHARE operations which could make the drop-off module unfeasible. Alternative options will be evaluated.

Preliminary results are currently presented in a number of international scientific conferences and will be summarized in the first newsletter of the CIRCLE project planned for September/October 2017.

Presentations of preliminary CIRCLE outcomes are planned at the workshop  “Household Finance and Retirement Savings”, scheduled on 19-20 October 2017 at the  Collegio Carlo Alberto, Turin. The workshop will include a session dedicated to CIRCLE and will also be an occasion to host a meeting of the Scientific Committee .

 

Download the project’s brochure.

Download the project’s conference poster.

 

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