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Pension Reform in China; The Need for a New Approach

  • Steven Vincent Dunaway
  • Vivek B. Arora
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    The rapid aging of China's population over the next few decades makes it important for a new pension system with broad and adequate coverage to be put in place quickly. Pension reforms, first initiated in 1997, have become bogged down in difficulties over dealing with the "legacy costs" associated with the relatively more generous benefits provided under the old system. This paper argues that a way forward is to separate the legacy problem from the problem of setting up a new pension system, and it suggests concrete proposals for setting up such a new system which would cover both urban and rural workers.

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    Paper provided by International Monetary Fund in its series IMF Working Papers with number 07/109.

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    Length: 15
    Date of creation: 01 May 2007
    Date of revision:
    Handle: RePEc:imf:imfwpa:07/109
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    1. Chen, Vivian Y., 2004. "A Macro Analysis of China Pension Pooling System: Incentive Issues and Financial Problem," Discussion Paper 195, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
    2. Jonathan Gruber & David Wise, 2005. "Social Security Programs and Retirement around the World: Fiscal Implications, Introduction and Summary," NBER Working Papers 11290, National Bureau of Economic Research, Inc.
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