Efficiency of Social Security Programs and Political Economy

Elderly population which has tripled in the past four decades requires more attention to pension plans and social security programs. This study explains the factors that affect the formation and development of social security programs in different countries in the framework of political and, economic - population theories. Based on these theories, the paper also analyzes the relationship between the political structure and social security plans. To this end, Dixon index is used as an indicator for determining social security efficiency in a regression model to analyze the political and economic factors effecting the efficiency of social security programs. The results show that in countries that enjoy greater degree of political freedom, the social security systems have higher efficiency. While for the rich and poor countries who suffer from the lower degree of political freedom, political factors have little role. In this content, economic factors including the share of aged population (65 years old and more) and also unfair income distribution have more effect on the efficiency of social security system in these countries.