IDEAS home Printed from https://ideas.repec.org/p/cpr/ceprdp/9156.html
   My bibliography  Save this paper

Sharing High Growth Across Generations: Pensions and Demographic Transition in China

Author

Listed:
  • Song, Zheng Michael
  • Storesletten, Kjetil
  • Wang, Yikai
  • Zilibotti, Fabrizio

Abstract

Intergenerational inequality and old-age poverty are salient issues in contemporary China. China's aging population threatens the fiscal sustainability of its pension system, a key vehicle for intergenerational redistribution. We analyze the positive and normative effects of alternative pension reforms, using a dynamic general equilibrium model that incorporates population dynamics and productivity growth. Although a reform is necessary, delaying its implementation implies large welfare gains for the (poorer) current generations, imposing only small costs on (richer) future generations. In contrast, a fully funded reform harms current generations, with small gains to future generations. High wage growth is key for these results.

Suggested Citation

  • Song, Zheng Michael & Storesletten, Kjetil & Wang, Yikai & Zilibotti, Fabrizio, 2012. "Sharing High Growth Across Generations: Pensions and Demographic Transition in China," CEPR Discussion Papers 9156, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:9156
    as

    Download full text from publisher

    File URL: http://www.cepr.org/active/publications/discussion_papers/dp.php?dpno=9156
    Download Restriction: CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Zai Liang & Zhongdong Ma, 2004. "China's Floating Population: New Evidence from the 2000 Census," Population and Development Review, The Population Council, Inc., vol. 30(3), pages 467-488, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Alan de Brauw & John Giles, 2017. "Migrant Opportunity and the Educational Attainment of Youth in Rural China," Journal of Human Resources, University of Wisconsin Press, vol. 52(1), pages 272-311.
    2. Zheng Mu & Wei-Jun Jean Yeung, 2018. "For Money or for a Life: A Mixed-Method Study on Migration and Time Use in China," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 139(1), pages 347-379, August.
    3. Terry Sicular & Yue Ximing & Björn Gustafsson & Li Shi, 2007. "The Urban–Rural Income Gap And Inequality In China," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 53(1), pages 93-126, March.
    4. Chang, Hongqin & Dong, Xiao-yuan & MacPhail, Fiona, 2011. "Labor Migration and Time Use Patterns of the Left-behind Children and Elderly in Rural China," World Development, Elsevier, vol. 39(12), pages 2199-2210.
    5. M. Giovanna Merli & Sara Hertog, 2010. "Masculine sex ratios, population age structure and the potential spread of HIV in China," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 22(3), pages 63-94.
    6. Chen, Joyce J., 2013. "Identifying non-cooperative behavior among spouses: Child outcomes in migrant-sending households," Journal of Development Economics, Elsevier, vol. 100(1), pages 1-18.
    7. Chuhong Wang & Xingfei Liu & Zizhong Yan, 2021. "Temporary versus permanent migration: The impact on expenditure patterns of households left behind," Review of Economics of the Household, Springer, vol. 19(3), pages 873-911, September.
    8. Chen, Juan, 2011. "Internal migration and health: Re-examining the healthy migrant phenomenon in China," Social Science & Medicine, Elsevier, vol. 72(8), pages 1294-1301, April.
    9. Zhishan Ma & Susu Zhang & Sidong Zhao, 2021. "Study on the Spatial Pattern of Migration Population in Egypt and Its Flow Field Characteristics from the Perspective of “Source-Flow-Sink”," Sustainability, MDPI, vol. 13(1), pages 1-27, January.
    10. He, Ming & Chen, Yang & van Marrewijk, Charles, 2017. "Urban Transformation and Technology Spillovers: Evidence from China's Electric Apparatus Sector," RIEI Working Papers 2017-01, Xi'an Jiaotong-Liverpool University, Research Institute for Economic Integration.
    11. Lida Fan, 2009. "Measuring Interprovincial Flows of Human Capital in China: 1995–2000," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 28(3), pages 367-387, June.
    12. Cadsby, C. Bram & Song, Fei & Yang, Xiaolan, 2020. "Are “left-behind” children really left behind? A lab-in-field experiment concerning the impact of rural/urban status and parental migration on children's other-regarding preferences," Journal of Economic Behavior & Organization, Elsevier, vol. 179(C), pages 715-728.
    13. Yang Zhan, 2018. "The urbanisation of rural migrants and the making of urban villages in contemporary China," Urban Studies, Urban Studies Journal Limited, vol. 55(7), pages 1525-1540, May.
    14. Holly Reed, 2013. "Moving Across Boundaries: Migration in South Africa, 1950–2000," Demography, Springer;Population Association of America (PAA), vol. 50(1), pages 71-95, February.
    15. Shang, Juan & Li, Pengfei & Li, Ling & Chen, Yong, 2018. "The relationship between population growth and capital allocation in urbanization," Technological Forecasting and Social Change, Elsevier, vol. 135(C), pages 249-256.
    16. Patrick S. Ward & Gerald E. Shively, 2015. "Migration and Land Rental as Responses to Income Shocks in Rural China," Pacific Economic Review, Wiley Blackwell, vol. 20(4), pages 511-543, October.
    17. Alan de Brauw & John Giles, 2018. "Migrant Labor Markets and the Welfare of Rural Households in the Developing World: Evidence from China," The World Bank Economic Review, World Bank Group, vol. 32(1), pages 1-18.
    18. Mu, Ren & van de Walle, Dominique, 2011. "Left behind to farm? Women's labor re-allocation in rural China," Labour Economics, Elsevier, vol. 18(S1), pages 83-97.
    19. Yanpeng Gao & Xiaofei Xu & Ye Wei, 2021. "Analysis on the imbalance of population flow network during the Spring Festival travel rush in China in 2015," PLOS ONE, Public Library of Science, vol. 16(4), pages 1-17, April.
    20. Yang Xiao & Yanjie Bian, 2018. "The influence of hukou and college education in China’s labour market," Urban Studies, Urban Studies Journal Limited, vol. 55(7), pages 1504-1524, May.

    More about this item

    Keywords

    China; Credit market imperfections; Demographic transition; Economic growth; Fully funded system; Inequality; Intergenerational redistribution; Labor supply; Migration; Pensions; Poverty;
    All these keywords.

    JEL classification:

    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:9156. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: https://www.cepr.org .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (email available below). General contact details of provider: https://www.cepr.org .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.