The Basic Manual of Social Security: Theory and Evaluation

Monograph, The Basic Manual of Social Security: Theory and Evaluation, Forthcoming

Posted: 10 Sep 2018

See all articles by Mario Arturo Ruiz Estrada

Mario Arturo Ruiz Estrada

Akademia Ekonomiczno-Humanistyczna w Warszawie

Evangelos Koutronas

West Virginia University - Department of Mathematics

Date Written: August 28, 2018


This monograph is divided into ten chapters. The first chapter presents a general description of each chapter respectively. The second chapter introduces the basic principles of social security. Its objective is rather to provide a brief outline of the concepts and the principles as well as the description of the established institutional framework. In particular, it presents the institutional structure of social security as well as its basic blueprint along with its recent developments. The taxonomy of pension arrangements is presented by giving emphasis on its legal status, format, type of arrangement, and type of coverage. The third chapter places the development of social security in a historical context. A particular emphasis is given to the history of European social security systems, which shaped social security systems worldwide. To complement the historical analysis, this chapter introduces the theoretical approaches and concepts have emerged in the social security field. The traditional classification of welfare states is being addressed through a path-dependency perspective. Finally, the welfare states are described briefly under cultural, social, economic, and political prism, pinpointing their deficiencies and mapping their patterns.

The fourth chapter examines the evolution of social security research from a theoretical and empirical perspective. This is done through an extensive review and analysis of publications from the Journal of International Social Security Review published by Wiley within a 50-year period (1967-2017). It was observed that at a different period in time, the social security research focused on different national and international issues that invoked different social welfare programs and pension systems approach (public or private) to facilitate the explanation of its final socio-economic impact into different social groups in the same country or region respectively. The fifth chapter explores the concept of pensionomics as a prospective tool for pension evaluation. This chapter suggests a paradigm shift: a multidisciplinary synthesis of differing perspectives in evaluating pension overall performance based on past work on pension evaluation, incorporating non-economic variables with significant impact on economic growth and social development. This chapter suggests a new analytical tool called “Pensions Consistency (PC) Index” that identifies the level of consistency as well as the strengths and weaknesses within any pension system. The new conceptual framework focuses on building inter-sectoral and holistic policies able to respond to the new multidimensional dynamic environment.

The sixth chapter examines the impact of welfare reforms on the sustainability of public pension schemes. This chapter reviewed past and current literature and practices of various countries to evaluate the effectiveness of reforms used from the aspect of structural and systemic parameters focusing on sustainability and distributive impartiality. This theoretical review concludes that there is no ideal pension scheme but there are reforms that have shown to be beneficial to the sustainability and distributive impartiality of pension systems and such reforms should be applied in combination to suit the economic dynamism of each individual country. The seventh chapter formulates an analytical framework to analyze whether pension growth can be a determinant of economic growth. The Pension Scheme Performance Evaluation Model (PSPE-Model) intends to study the performance of pension schemes from a macroeconomic perspective. The PSPE-Model tests whether the marginal optimum national pension system coverage critical point based on the national productivity growth performance is simultaneously determined by the efficient coordination of private and public pension system programs coverage and the national productivity level. The model investigates the marginal optim

The eighth chapter explores how inflation and the exchange rate can affect the real value of any pension plan system in the long run. In our case, we focus on the specific pension plan system of the Employees Provident Fund (EPF). Nonetheless, we use a new model that is entitled “The EPF Real Value Box –EPFRV Box”. The EPFRV Box facilitates the graphical visualization of the inflation/exchange rate impact on the Employees Provident Fund (EPF). In essence, the EPFRV Box is applied to the Employees Provident Fund (EPF) of Malaysia to evaluate the impact of inflation and exchange rates on the Malaysian EPF real value from 1980 to 2030. Finally, the main objective is to apply the EPFRV Box to extend the significance of the impact of inflation and the exchange rate on any pension plan system (in this case EPF) beyond mere theory, using them as practical instruments to solve retirement and pensioner’s problems. The ninth chapter formulates a comprehensive pension fund framework for enhancing system capacity to manage economic and social risks. The National Social Protection Fund (NSPF) attempts to quantify the informal sector, incorporated under a unified national protection scheme. The new protection mechanism consists of two sub-funds: The National Integral Social Security Fund (NISSF) and the National Education Fund (NEF). NISSF encompasses all economically active Malaysian population, including the informal workforce, whereas the NSPF captures the economically inactive young population. Simulation findings indicate that education, health, and income redistribution can improve the livelihood of the vulnerable population groups in Malaysia.

Finally, the tenth chapter proposes a new model based on a group of indicators to evaluate the social security plans performance of ASEAN-members (Singapore, Malaysia, Indonesia, Thailand, and the Philippines). The first section presents a general review of all possible indicators applies in the evaluation of social security plans performance. Secondly, we present a new indicator, “The Social Security Plans Performance Index (SSPP-Index)” is intended to offer policymakers and researchers an additional analytical tool to study the coverage, efficiency, effectiveness, trend, and future of any social security plan as a whole. The SSPP-Index can be applied to the study of any social security plan and not constrained by geographical area or development stage of the social security plan on the study. The SSPP-Index is a simple and flexible indicator. The third section summarizes the results on the ASEAN-Members social security plans performance under the application of the SSPP-Index.

Keywords: Social Security, Social Protection, Econographicology

JEL Classification: F65

Suggested Citation

Ruiz Estrada, Mario Arturo and Koutronas, Evangelos, The Basic Manual of Social Security: Theory and Evaluation (August 28, 2018). Monograph, The Basic Manual of Social Security: Theory and Evaluation, Forthcoming, Available at SSRN:

Mario Arturo Ruiz Estrada (Contact Author)

Akademia Ekonomiczno-Humanistyczna w Warszawie ( email )

Okopowa 59, 01-043 Warsaw, Poland
Warsaw, 00-007
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HOME PAGE: http://

Evangelos Koutronas

West Virginia University - Department of Mathematics ( email )

PO Box 6201
Morgantown, WV 26506
United States

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