Pension provision as a tool for reduction of informal unemployment in the context of social insurance

Abstract

Social security tools are increasingly considered to be a highly effective
mechanism for reduction of informal employment since receiving benefits
in pension provision is only possible through the legal employment.
In this regard the determination of pension provision is necessary for the
further development of the pension sphere. Nowadays the various pension
systems in the world are based on a combination of three main institutions
of pension provision, such as social assistance, compulsory pension
insurance and private voluntary insurance. These institutions considered
as a tool for poverty reduction in the developed countries and as insurance
against risks in order to achieve the minimum required level of life
expectancy at retirement age through collective forms of wage earners and
“self-employed” people insurance during employment. Institute of funds
accumulation on a voluntary basis supports life wealth at retirement and
it is one of the main mechanisms of self-protection of workers and small
businesses in some countries. The article reveals the basic pension institutions
and pension models in different countries.