Model Austria? - What are the differences in pension benefits compared to Germany and how can they be explained?

Austria is currently cited in German social policy discussions as a role model in the field of old-age provision because of high income replacement ratios offered by public pension benefits. Austria has been able to assume this role primarily due to its high theoretical gross and net income replacement rates according to the OECD method. In the current OECD report, a ratio of 38.7 percent gross (51.9 percent net) to average life time income is shown for Germany; for Austria this ratio is 76.5 percent gross (89.9 percent net). This study intends to highlight the differences in benefit legislation in the two countries and thus provide an explanation for the deviating income replacement ratios.