Academic report criticizes status quo of Peruvian pension system

Academics María Amparo Cruz-Saco, Juan Mendoza and Bruno Seminario, find three basic errors in the existing models: they criticize the attempt to finance pensions through a tax on workers’ wages in a market where about two-thirds of employment is informal, they find ample evidence that people are saving voluntarily for old age outside of the system, and they argue that existing law is “suffocating” initiative and competition between AFPs.