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Pension Age Increase: Positive Effects and the Possible Risks
[Повышение Пенсионного Возраста: Позитивные Эффекты И Вероятные Риски]

Author

Listed:
  • Gorlin, Yuriy M. (Горлин, Юрий М.)

    (Russian Presidential Academy of National Economy and Public Administration)

  • Lyashok, Victor Yu. (Ляшок, Виктор Ю.)

    (Russian Presidential Academy of National Economy and Public Administration, National Research University Higher School of Economics)

  • Maleva, Tatiana M. (Малева, Татьяна М.)

    (Russian Presidential Academy of National Economy and Public Administration)

Abstract

In this paper, we explain why it is necessary to reform the pension system in Russia and, in particular, to increase the pension age. Moreover, we emphasize the positive consequences of such a reform, focus on potential risks and analyze measures for their prevention, as well as state counter-arguments to the most common objections. It is shown that due to demographic processes, the growth of informal employment and the reduction of average tenure, the number of pensioners is increasing while the population of donors of the pension system is declining. Under such conditions, the maintenance of the existing level of pensions will require significant additional costs. Raising the general retirement age as one of the measures for optimization of the pension system will help not only to maintain the level of pensions, but also to prevent the expansion of transfer payments from the federal budget and the increase of tax burden on the population and business. The reform will improve the situation on the labor market and stimulate the process of active longevity. It is also shown that the arguments against the increase of the retirement age are not well-founded. Several scenarios of the retirement age increase are considered, and the choice of the most favorable way for the Russian economy is made: up to 63 years for men and 60 years for women at the pace of 3 months per year in the first four years of the reform, then 6 months per year. The most crucial tasks which should be solved in order to maximize the social and economic output of the reform are also considered in the paper.

Suggested Citation

  • Gorlin, Yuriy M. (Горлин, Юрий М.) & Lyashok, Victor Yu. (Ляшок, Виктор Ю.) & Maleva, Tatiana M. (Малева, Татьяна М.), 2018. "Pension Age Increase: Positive Effects and the Possible Risks
    [Повышение Пенсионного Возраста: Позитивные Эффекты И Вероятные Риски]
    ," Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 1, pages 148-179, February.
  • Handle: RePEc:rnp:ecopol:ep1806
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    References listed on IDEAS

    as
    1. Frey, Carl Benedikt & Osborne, Michael A., 2017. "The future of employment: How susceptible are jobs to computerisation?," Technological Forecasting and Social Change, Elsevier, vol. 114(C), pages 254-280.
    2. A. Vishnevsky & S. Vasin & A. Ramonov., 2012. "Retirement Age and Life Expectancy in the Russian Federation," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 9.
    3. Dhaval Dave & R. Inas Rashad & Jasmina Spasojevic, 2008. "The Effects of Retirement on Physical and Mental Health Outcomes," Southern Economic Journal, Southern Economic Association, vol. 75(2), pages 497-523, October.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    pension age; life expectancy; elderly employment; ageing; pension reform.;

    JEL classification:

    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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