Public Pension and Household Saving: Evidence from urban China

Jin Feng, Lixin He and Hiroshi Sato ()

Global COE Hi-Stat Discussion Paper Series from Institute of Economic Research, Hitotsubashi University

Abstract: We relate household saving to pension reform, to explain the high household saving rates in urban China from a new perspective. We use the exogenous-policy induced-variation in pension wealth to explicitly estimate the impact of pension wealth on household saving, and obtain a significant offset effect of pension wealth on household saving. Our estimations show that pension reform boosted the household saving rate in 1999 by about 6 percentage points for cohort aged 25-29 and by about 3 percentage points for cohort aged 50-59. Our results also indicate that declining pension wealth reduces expenditure on education and health more than on other consumption items.

Keywords: pension reform; pension wealth; household saving rate; urban China (search for similar items in EconPapers)
JEL-codes: E21 H55 P43 (search for similar items in EconPapers)
Date: 2009-02
New Economics Papers: this item is included in nep-cna, nep-dev, nep-lab, nep-mac and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (22)

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Journal Article: Public pension and household saving: Evidence from urban China (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:hst:ghsdps:gd08-030

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