Economic growth and funded pension systems

Michiel Bijlsma, Ferry Haaijen and Casper Ewijk

No 279, CPB Discussion Paper from CPB Netherlands Bureau for Economic Policy Analysis

Abstract: Growing pension savings lead to deeper capital markets. This can have a positive effect on economic growth by allowing firms that are more dependent on external finance to grow faster. We study this effect using data on 69 industrial sectors in 34 OECD countries for the period 2001-2010 through a difference-in-differences approach that interacts financial development with industry dependence on external finance. We take into account unobserved heterogeneity by including country-time, industry-time and industry-country fixed effects. We find a significant impact of higher level of pension savings on growth in sectors that are more dependent on external financing. The financial crisis does not significantly affect this relation.

JEL-codes: C23 J26 O43 (search for similar items in EconPapers)
Date: 2014-07
New Economics Papers: this item is included in nep-age, nep-fdg and nep-gro
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:cpb:discus:279

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