The paper develops a simple, integrated methodology to project public pension cash flows and healthcare spending over the long term. We illustrate its features by applying it to the LAC5 (Argentina, Brazil, Chile, Colombia and Mexico), where public spending pressures are expected to increase significantly over 2015-50 due to demographic trends and rising healthcare costs. We simulate alternative pension reforms, including the transition from a defined benefit to a defined contribution pension system and the fiscal burden of a minimum guaranteed pension under the latter. We also analyze public healthcare outlays in the LAC5, which is likewise expected to increase significantly over 2015-50 due to aging and the so-called excess cost growth factor of healthcare services, showing that curbing the evolution of the latter (e.g., through enhanced competition in the healthcare sector) could aid in containing spending pressures. Despite its simplicity, the methodology yields projections that compare well with other approaches. It therefore provides a good benchmark for assessing alternative reform scenarios, particularly in data-constrained countries.

This doctoral dissertation is divided in three chapters that advance our understanding of the relationship between population ageing, productivity, and social protection. The study starts at the root of these issues, by reviewing the definition of ageing. According to the World Health Organisation’s (2015) authoritative report, ageing at the individual level is related to social and biological characteristics that negatively affect a person’s capacity to pursue whatever they value, including their participation in the labour force. Across time, these characteristics are not necessarily linked to an individual’s age. However, the most common indicator of aggregate population ageing, the old-age dependency ratio (OADR), is exclusively based on the population age structure. Relying on such age-based (also called chronological) measures can create a bias in the way we understand the consequences of population ageing...