How Will Sweden's New Pension System Work?
March 2000
IB#3
Introduction
In 1998, the Swedish Parliament passed pension legislation that transformed Sweden’s Social Security system to a Notional Defined Contribution (NDC) plan ¾ that is, a defined contribution plan financed on a pay-as-you-go basis. In addition, the legislature established a second tier of funded benefits. This Issue in Brief describes the evolution of the new Swedish pension system and discusses its implications for other countries considering pension reform...
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Annika Sundén is the Associate Director for Research at the Center for Retirement Research at Boston College. The author thanks Andy Eschtruth, Alicia Munnell, Robert Palacios, and Edward Palmer for helpful comments. The views and remaining errors are those of the author.