Public Pensions and Private Savings

Esteban Garcia-Miralles and Jonathan Leganza

American Economic Journal: Economic Policy, 2024, vol. 16, issue 2, 366-405

Abstract: How does the provision of public pension benefits impact private savings? We answer this question in the context of a Danish reform that increased social security eligibility ages. Using administrative data and a regression discontinuity design, we identify the causal effects of the policy on savings throughout the financial portfolio. We find increases in contributions to personal and employer-sponsored retirement accounts when delayed benefit eligibility induces extended employment. We argue that inertia—the continuation of previous savings behaviors—is a key mechanism, and we highlight how firm default contribution rate policies can mediate savings responses to social security reform.

JEL-codes: G51 H55 J22 J26 J32 (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (1)

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Working Paper: Public Pensions and Private Savings (2021)
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DOI: 10.1257/pol.20220019

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