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Labor History and Contribution Density in the Pension System of the Dominican Republic

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  • Apella, Ignacio Raul
  • Zunino,Gonzalo

Abstract

This paper estimates the proportion of workers who would meet the required contribution periods to access a contributory retirement pension in the Dominican Republic. Using microdata from labor histories, the paper proposes a survival model to estimate the hazard rates of entering and exiting the contributory state in the pension system. Furthermore, a Monte Carlo simulation is performed to project contributory histories. The results suggest that the transition rates are relatively high, averaging a probability of exiting the contributory (non-contributory) state of 7 percent (6 percent). Moreover, the hazard rate of transitioning to a different state is negatively associated with the worker’s duration in the current state. These effects are conditioned to the age and income level of the worker. Finally, a simulation of new labor histories estimates that slightly more than 20 percent of the workers would meet the requirement of 30 years of contributions by age 60, and this percentage would exceed 40 percent if the required years of contributions were reduced to 20.

Suggested Citation

  • Apella, Ignacio Raul & Zunino,Gonzalo, 2025. "Labor History and Contribution Density in the Pension System of the Dominican Republic," Policy Research Working Paper Series 11103, The World Bank.
    • Handle: RePEc:wbk:wbrwps:11103
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    References listed on IDEAS

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    1. Auerbach, Paula & Genoni, María Eugenia & Pagés, Carmen, 2005. "Social Security Coverage and the Labor Market in Developing Countries," IDB Publications (Working Papers) 1111, Inter-American Development Bank.
    2. Bucheli, Marisa & Forteza, Alvaro & Rossi, Ianina, 2010. "Work histories and the access to contributory pensions: the case of Uruguay," Journal of Pension Economics and Finance, Cambridge University Press, vol. 9(3), pages 369-391, July.
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