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There has been consideration of alternative social security financing methods throughout the world. One alternative adopted in several countries is the privatization of pay-as-you-go financing systems. This book estimates social benefits and social costs associated with a Feldsteinian-type gradual privatization of the three Turkish social security institutions. Using data that provided by the ILO, financial projections of the three institutions were made and extended to apply benefit-cost models of privatization. Present values of the change in net social benefit for each institution were estimated. The effect of privatization on representative individuals has been quantified for each institution. Benefit-cost results indicate that social benefits associated with a privatization alternative for each of the three Turkish social security institutions exceed the social costs even after adjustments for changes in key parameters that reduce social net benefits. However, privatization affects current representative individuals so negatively that it may constitute a "good political reason" to be against, rather than in favor of, choosing privatization.
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