Public pension and household saving: Evidence from China
AbstractWe relate household saving to pension reform, to explain the high household saving rates in urban China from a new perspective. We use the exogenous – policy induced - variation in pension wealth to explicitly estimate the impact of pension wealth on household saving, and obtain a significant offset effect of pension wealth on household saving. Our estima-tions show that pension reform boosted the household saving rate in 1999 by about 6 per-centage points for cohort aged 25-29 and by about 3 percentage points for cohort aged 50-59. Our results also indicate that declining pension wealth reduces expenditure on educa-tion and health more than on other consumption items.
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Bibliographic InfoPaper provided by Bank of Finland, Institute for Economies in Transition in its series BOFIT Discussion Papers with number 2/2009.
Length: 36 pages
Date of creation: 20 Apr 2009
Date of revision:
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Postal: Bank of Finland, BOFIT, P.O. Box 160, FI-00101 Helsinki, Finland
Phone: + 358 10 831 2268
Fax: + 358 10 831 2294
Web page: http://www.suomenpankki.fi/bofit_en/
More information through EDIRC
pensions; pension reform; household savings rate; China;
Find related papers by JEL classification:
- H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
- H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
- P35 - Economic Systems - - Socialist Institutions and Their Transitions - - - Public Finance
This paper has been announced in the following NEP Reports:
- NEP-AGE-2009-04-25 (Economics of Ageing)
- NEP-ALL-2009-04-25 (All new papers)
- NEP-CNA-2009-04-25 (China)
- NEP-DEV-2009-04-25 (Development)
- NEP-PUB-2009-04-25 (Public Finance)
- NEP-TRA-2009-04-25 (Transition Economics)
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