 A Simulation Study of the Effect of Delayed Retirement on Welfare of the Elderly: Evidence from ChinaZheng Shen and James Yang SAGE Open, 2021, vol. 11, issue 2, 21582440211016901 Abstract: In order to cope with population aging and emerging labor shortages, the Chinese government may soon introduce a policy to address this problem by raising the normal retirement age. However, the effects of planning for delayed retirement on the welfare of the elderly remain unknown. From an intergenerational support perspective, we develop a dynamic optimization model that can simulate changes in the welfare of the elderly over the years under different delayed retirement scenarios. Simulation results show that delaying retirement will produce a detrimental effect on old-age welfare. We further analyze strategies to mitigate this adverse effect and improve people’s welfare. First, the delayed retirement policy should raise the pension replacement rate, which could transfer part of the social welfare improvements from delayed retirement to the elderly through the transfer payment mechanism. Second, when adopting a defined-contribution pension system, the delayed retirement could increase the welfare of the elderly and the social well-being. Implications for future research and public policies concerning welfare effects of delayed retirement are discussed. Keywords: delayed retirement; welfare of the elderly; intergenerational support; pension system; DB (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:sae:sagope:v:11:y:2021:i:2:p:21582440211016901 DOI: 10.1177/21582440211016901 Access Statistics for this article More articles in SAGE Open |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.