Analysis of the Performance of the Management of the Automatic Balancing Mechanism

Starting from an equilibrium state it is developed a theoretical study on the performance of the management of the Swedish notional defined contribution (NDC) system, under a set of stress scenarios, in terms of solvency and equity with and without its automatic balancing mechanism. The solvency analysis comprises its intrinsic and long term performance. The solvency and equity performance of the Swedish NDC are also analysed, when a new contributory regime based on a notional defined contribution system is immediately adopted to the Portuguese economic and demographic environment, as of the beginning of 2014, inspired by the principles of the Swedish model, abandoning the old age public pension scheme in force in Portugal.