Funding Social Insurance - Theoretical Aspect
Funding Social Insurance - Theoretical Aspect

Summary/Abstract: In this paper, the authors have analyzed the problems of funding social insurance, which are particularly present in the circumstances of the enormous growth of social insurance expenditures in both developed and transition countries. Drawing upon the Bismarck and the Beverage models of social insurance, the authors discuss the legal nature of the social insurance contribution, a duty intended for financing social security. The authors have specifically explored the social insurance funding systems, such as: the pay-as-you-go system (PAYG system of adjusting contributions and bring them in line with the social insurance expenditures), and the funded system (based on capital accumulation), considering their characteristics and their capacity to adequately respond to the complex needs of the modern world.

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