Demographic Changes and Pension Finances in Vietnam
AbstractThis paper aims to provide a long-term financial vision for the Vietnamese pension scheme using stochastic modeling for key variables under an actuarial framework. In particular, we project the pension fund balances in order to see whether the scheme will be financially sustainable. The median values of the status-quo projections show that the pension fund will be depleted in about 2052 with a 90-percent confidence interval range of 8 years. The estimated results from our sensitivity tests show that the retirement age, the indexation method for pension benefits, and the contribution rate are all crucial determinants of the pension fund balance in the long term. At the same time, some factors, including coverage rates, administrative costs, the long-term fertility rate, and the rate of return on pension fund assets play less important roles in determining the fund’s balance.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 9931.
Date of creation: 2008
Date of revision:
aging; stochastic projections; pension finances; Vietnam;
Find related papers by JEL classification:
- H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
- G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
This paper has been announced in the following NEP Reports:
- NEP-AGE-2008-08-14 (Economics of Ageing)
- NEP-ALL-2008-08-14 (All new papers)
- NEP-DEV-2008-08-14 (Development)
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