Despite its massive geological endowment and receiving what could be considered the largest windfall in its economic history, Venezuela entered 2020 in the middle of an unprecedented economic crisis. The Covid-19 pandemic and turbulence in oil markets represent the latest in a string of problems that expose the country’s vulnerability.
Given that policymakers will eventually need to decide how to resolve the social security program’s projected shortfall, this paper presents a simulation-based approach to evaluating the conventional alternatives of adjustments to benefits or taxes.