How do countries strike a balance between keeping government budgets in check and providing strong social safety nets for their citizens? As the world becomes more interconnected and demands for services grow, governments must find a way to satisfy this. Scholars have overlooked the connections between government and citizens driving changes in policy design, especially in pension reform. This article investigates the factors that lead to changes in social and pension reform in OECD countries. To do this, the author incorporates “social cohesion” into the study design as a new perspective to determine how state-citizen cohesion (government trust) and civic engagement influence how to achieve policy changes in social and pension design. This study provides valuable insights into how coherence between governments and citizens resolves and encourages policy design problem-solving.
Hypotheses
The author explores the role of social cohesion in influencing the selection of policy tools to achieve changes in social and pension policies.
Methodology
The author analyzes panel data from 30 OECD countries over the period 2010-2020. Social cohesion is measured using “government trust” and “civic engagement” as key indicators to test the relationship with social and pension policy instruments. Because policy choices evolve over time and vary across countries, the analysis employs system Generalized Method of Moments (system GMM), a statistical method well suited to capturing country-specific contexts and policy dynamics in longitudinal data.
Key Findings
Government Trust and Civic Engagement Affect the Multi-Tier Pension System Differently
As shown in Table 3, government trust and civic engagement affect pension policy instruments differently. Model 1 shows that increases in government trust leads to an increase in measures for fiscal sustainability. However, increases in civic engagement correlate with pension benefit levels in a multi-tier system expanding. Interestingly, Model 2 shows that government trust helps sustain and enhance mandatory public pension benefits, while civic engagement reduces citizen reliance on mandatory public pensions, suggesting a gradual shift toward greater diversification through private pension arrangements. In short, government trust and civic engagement shape both policy instruments and citizens’ preferences for addressing pension design challenges in different ways.
Table 3. Impacts of Social Cohesion on Pension Policy Instruments in Multi-Tier Pension System.
Government Trust Strengthens while Civic Engagement Weakens First-Tier Pensions
Table 4 shows that government trust and civic engagement affect first-tier pension systems in different ways. Model 1 tells us that government trust positively affects first-tier pension benefit levels, making them robust. Meanwhile, civic engagement negatively affects the overall level of first-tier pensions by shifting dependency toward private pensions. Furthermore, Model 2 demonstrates that civic engagement strengthens the universal and redistributive nature of non-contributory schemes within first-tier pension systems.
Table 4 Impact of Social Cohesion on Pension Policy Instrument Mix in the First-Tier Pension System.
Why It Matters
This article highlights the importance of applying social cohesion, understood as the interactions between government(s) and citizens, in improving current policy processes. Social cohesion is needed for harmonization between government and citizens to achieve effective policy outcomes. For policymakers, this research shows that social cohesion connects government and citizens to the overall design and application of policy tools to fix structural problems within social and pension policies. Future studies should consider the role of social cohesion, with an emphasis on state-citizen dynamics, to understand how social connections influence the design of important policy programs.
Read the original article in Policy Studies Journal:
Kim, J. (2025). The Place of Social Cohesion in Policy Design: Lessons From the Evolution of Pension Policy Instruments Mix in OECD Countries. Policy Studies Journal, 53(3), 681-700. https://onlinelibrary.wiley.com/doi/10.1111/psj.70000.
About the Article’s Author(s)
Jiwon Kim, PhD (Seoul National University), is a Professor in the Department of Public Administration at the School of Social Integration, Hankyong National University. Her research centers on policy analysis and evaluation, welfare finance, and social welfare policy, with a particular focus on marginalized groups—such as persons with disabilities, industrial accident workers, and public servants injured in the line of duty—as well as on public performance management. She was a Visiting Scholar at the School of Public Affairs and Administration at Rutgers University—Newark from March 2023 to February 2024. In acknowledgement of her significant contributions to empirical research in social policy, she received the 2024 Commendation from the Deputy Prime Minister and Minister of Education of South Korea.
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