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The Notional and the Real in China’s Pension Reforms

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  • Bei Lu
  • John Piggott
  • Bingwen Zheng

Abstract

This paper discusses the potential expansion of the role of the notional defined contribution (NDC) paradigm in the ongoing reforms of retirement provision in China. It finds that mature age life expectancy is remarkably uniform among formal sector workers at the time of retirement, although greater heterogeneity does exist for Rural and Urban Residents Pension Scheme members. The implications of a stylized NDC structure are examined covering China?s major pension systems, calibrated to be actuarially neutral. Each system has a different contribution rate and retirement age, consistent with different life expectancies. A complementary social pension is also proposed. The paper concludes that an increased presence of the NDC paradigm has the potential to raise aggregate welfare.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Bei Lu & John Piggott & Bingwen Zheng, 2019. "The Notional and the Real in China’s Pension Reforms," World Bank Publications - Reports 31645, The World Bank Group.
    • Handle: RePEc:wbk:wboper:31645
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    References listed on IDEAS

    as
    1. Robert Holzmann, 2017. "The ABCs of nonfinancial defined contribution (NDC) schemes," International Social Security Review, John Wiley & Sons, vol. 70(3), pages 53-77, July.
    2. Lu, Bei & He, Wenjiong & Piggott, John, 2014. "Should China introduce a social pension?," The Journal of the Economics of Ageing, Elsevier, vol. 4(C), pages 76-87.
    3. Emil Tesliuc & Margaret Grosh & Azedine Ouerghi & Carlo del Ninno, 2008. "For Protection and Promotion : The Design and Implementation of Effective Safety Nets," World Bank Publications - Books, The World Bank Group, number 6582, April.
    4. Richard Hinz & Robert Holzmann, 2005. "Old Age Income Support in the 21st century: An International Perspective on Pension Systems and Reform," World Bank Publications - Books, The World Bank Group, number 7336, April.
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