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The long term impact of Chilean policy reforms on savings and pensions

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  • Madeira, Carlos

Abstract

Using a combination of survey data plus the demographic and life expectancy projections for Chile I simulate how different policies may impact the workers’ pensions and voluntary savings. I find that households dissave from their public pension benefits, but not from their contributory pensions, therefore policy increases of contributions are not crowded-out by private decisions. The results show that an increase of the contribution rate plus a delay of the retirement age is necessary to achieve high replacement ratios until 2055. Boosting the education of younger generations and incentives for female employment is efficient for increasing pensions among the poorest households.

Suggested Citation

  • Madeira, Carlos, 2021. "The long term impact of Chilean policy reforms on savings and pensions," The Journal of the Economics of Ageing, Elsevier, vol. 19(C).
    • Handle: RePEc:eee:joecag:v:19:y:2021:i:c:s2212828x21000190
    DOI: 10.1016/j.jeoa.2021.100326
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    Cited by:

    1. Marcela PARADA‐CONTZEN, 2023. "Gender, family status and health characteristics: Understanding retirement inequalities in the Chilean pension model," International Labour Review, International Labour Organization, vol. 162(2), pages 271-303, June.
    2. Carlos Madeira, 2023. "Use of Financial Instruments Among the Chilean Households," Lecture Notes in Operations Research, in: Pascal Alphonse & Karima Bouaiss & Pascal Grandin & Constantin Zopounidis (ed.), Essays on Financial Analytics, pages 63-86, Springer.
    3. Oscar Becerra, 2023. "Effects of future pension benefits on pre‐retirement labor supply: Evidence from Chile," Review of Development Economics, Wiley Blackwell, vol. 27(1), pages 198-219, February.

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    More about this item

    Keywords

    Savings; Pensions; Labor income; Income volatility;
    All these keywords.

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean

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