Publication:
Implicit Pension Debt, Transition Cost, Options, and Impact of China's Pension Reform : A Computable General Equilibrium Analysis

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dc.contributor.authorWang, Yan
dc.contributor.authorXu, Dianqing
dc.contributor.authorWang, Zhi
dc.contributor.authorZhai, Fan
dc.date.accessioned2014-08-26T19:40:47Z
dc.date.available2014-08-26T19:40:47Z
dc.date.issued2001-02
dc.description.abstractThe main problems with China's pension system--the pension burdens of state enterprises and the agency of the population--have deepened in recent years. Using a new computable general equilibrium model that differentiates between three types of enterprise ownership and 22 groups in the labor force, the authors estimate the effects of pension reform in China, comparing various options for financing the transition cost. They examine the impact that various reform options would have on the system's sustainability, on overall economic growth, and on income distribution. The results are promising. The current pay-as-you-go system, with a notional individual account, remains unchanged in the first scenario examined. Simulations show this system to be unsustainable. Expanding coverage under this system would improve financial viability in the short run but weaken it in the long run. Other scenarios assume that the transition cost will be financed by various taxes and that a new, fully funded individual account will be established in 2001. The authors compare the impact of a corporate tax, a value-added tax, a personal income tax, and a consumption tax. They estimate the annual transition cost to be about 0.6 percent of Gross Domestic Product (GDP) between 2000 and 2010, declining to 0.3 percent by 2050. Using a personal income tax to finance the transition cost would best promote economic growth and reduce income inequality. Levying a social security tax and injecting fiscal resources to finance the transition costs would help make the reformed public pillar sustainable. To finance a benefit of 20 percent of the average wage, a contribution rate of only 10 percent-12.5 percent would be enough to balance the basic pension pillar. Gradually increasing the retirement age would further reduce the contribution rate.en
dc.identifierhttp://documents.worldbank.org/curated/en/2001/02/1003174/implicit-pension-debt-transition-cost-options-impact-chinas-pension-reform-computable-general-equilibrium-analysis
dc.identifier.doi10.1596/1813-9450-2555
dc.identifier.urihttps://hdl.handle.net/10986/19708
dc.languageEnglish
dc.language.isoen_US
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper;No. 2555
dc.rightsCC BY 3.0 IGO
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectACCOUNTING SYSTEM
dc.subjectADMINISTRATIVE COSTS
dc.subjectADMINISTRATIVE SYSTEM
dc.subjectALLOCATION OF RESOURCES
dc.subjectAUTHORITY
dc.subjectBASIC BENEFIT
dc.subjectBASIC PENSION
dc.subjectBENEFIT LEVEL
dc.subjectBUDGET SURPLUS
dc.subjectCENTRAL GOVERNMENT
dc.subjectCENTRAL GOVERNMENTS
dc.subjectCOMPETITIVE BIDDING
dc.subjectCONTRIBUTION RATE
dc.subjectCONTRIBUTION RATES
dc.subjectDEBT
dc.subjectDECREE
dc.subjectDECREES
dc.subjectDEFICITS
dc.subjectDEFINED BENEFITS
dc.subjectDEFINED CONTRIBUTION PROVIDENT FUNDS
dc.subjectDEFINED CONTRIBUTION SYSTEMS
dc.subjectDEPENDENCY RATIO
dc.subjectDEPOSIT INSURANCE
dc.subjectDEPOSIT INSURANCE SCHEMES
dc.subjectDISCOUNT RATES
dc.subjectECONOMIC GROWTH
dc.subjectECONOMIC REFORM
dc.subjectECONOMISTS
dc.subjectEMPIRICAL EVIDENCE
dc.subjectEMPLOYMENT
dc.subjectENTERPRISE OWNERSHIP
dc.subjectENTERPRISE REFORM
dc.subjectEQUILIBRIUM
dc.subjectEXPENDITURES
dc.subjectFACE VALUE
dc.subjectFINANCIAL SECTORS
dc.subjectFINANCIAL SUSTAINABILITY
dc.subjectFINANCIAL VIABILITY
dc.subjectFISCAL
dc.subjectFISCAL EXPENDITURE
dc.subjectFISCAL POLICIES
dc.subjectFISCAL RESOURCES
dc.subjectFISCAL STABILITY
dc.subjectFISCAL SUSTAINABILITY
dc.subjectFOREIGN DEBT
dc.subjectFUTURE PENSIONS
dc.subjectGENERAL EQUILIBRIUM MODEL
dc.subjectGOVERNMENT DEBT
dc.subjectGOVERNMENT POLICY
dc.subjectIMPORTS
dc.subjectINCENTIVE PROBLEMS
dc.subjectINCOME
dc.subjectINCOME DISTRIBUTION
dc.subjectINCOME INEQUALITY
dc.subjectINDEXATION
dc.subjectINDIVIDUAL ACCOUNTS
dc.subjectINFORMAL ECONOMY
dc.subjectINFORMAL EMPLOYMENT
dc.subjectINFORMAL SECTOR
dc.subjectINTERGENERATIONAL EQUITY
dc.subjectINVENTORIES
dc.subjectINVENTORY
dc.subjectLABOR FORCE
dc.subjectLABOR INPUTS
dc.subjectLABOR MARKET
dc.subjectLABOR SUPPLY
dc.subjectLIFE EXPECTANCY
dc.subjectLOCAL GOVERNMENT
dc.subjectLOCAL GOVERNMENT FINANCE
dc.subjectLOCAL GOVERNMENTS
dc.subjectLOCAL TAX
dc.subjectMARKET DISTORTIONS
dc.subjectMARKET PRICES
dc.subjectMINISTRY OF FINANCE
dc.subjectMULTIPILLAR SYSTEMS
dc.subjectMUNICIPALITIES
dc.subjectMUNICIPALITY
dc.subjectPAYROLL TAX
dc.subjectPAYROLL TAXES
dc.subjectPENSION COVERAGE
dc.subjectPENSION DEBT
dc.subjectPENSION FUND
dc.subjectPENSION FUNDS
dc.subjectPENSION INSURANCE
dc.subjectPENSION LIABILITIES
dc.subjectPENSION REFORM
dc.subjectPENSION REFORMS
dc.subjectPENSION RIGHTS
dc.subjectPENSION SERVICES
dc.subjectPENSION SYSTEM
dc.subjectPENSION SYSTEM REFORM
dc.subjectPENSION SYSTEMS
dc.subjectPENSIONERS
dc.subjectPENSIONS
dc.subjectPERSONAL SAVINGS
dc.subjectPOLICY INSTRUMENTS
dc.subjectPOPULATION DYNAMICS
dc.subjectPOPULATION GROWTH
dc.subjectPOVERTY LINE
dc.subjectPREFECTURE GOVERNMENTS
dc.subjectPRESENT VALUE
dc.subjectPRIVATIZATION
dc.subjectPRODUCTIVITY
dc.subjectPUBLIC ENTERPRISES
dc.subjectPUBLIC EXPENDITURE
dc.subjectPUBLIC EXPENDITURES
dc.subjectPUBLIC PILLAR
dc.subjectPUBLIC POLICIES
dc.subjectPUBLIC POLICY
dc.subjectPUBLIC RESOURCES
dc.subjectPUBLIC SECTOR
dc.subjectREPLACEMENT RATE
dc.subjectREPLACEMENT RATES
dc.subjectRESOURCE ALLOCATION
dc.subjectRETIREES
dc.subjectRETIREMENT
dc.subjectRETIREMENT AGE
dc.subjectREVENUE SOURCES
dc.subjectSAVINGS
dc.subjectSOCIAL INSURANCE
dc.subjectSOCIAL INSURANCE CONTRIBUTIONS
dc.subjectSOCIAL INSURANCE FUNDS
dc.subjectSOCIAL SECURITY
dc.subjectSOCIAL SECURITY BENEFITS
dc.subjectSOCIAL SECURITY REFORM
dc.subjectSOCIAL SECURITY TAXES
dc.subjectSTATE ASSETS
dc.subjectSTATE BANKS
dc.subjectSTATE ENTERPRISE
dc.subjectSTATE ENTERPRISES
dc.subjectSTATE PLANNING
dc.subjectSTATE SECTOR
dc.subjectSTATE-OWNED ENTERPRISES
dc.subjectTAX RATES
dc.subjectTAX REVENUE
dc.subjectTAXATION
dc.subjectTRADE POLICIES
dc.subjectUNEMPLOYMENT
dc.subjectWAGES
dc.subjectWELFARE EFFECTS
dc.titleImplicit Pension Debt, Transition Cost, Options, and Impact of China's Pension Reform : A Computable General Equilibrium Analysisen
dspace.entity.typePublication
okr.crossref.titleImplicit Pension Debt, Transition Cost, Options, and Impact of China’s Pension Reform: A Computable General Equilibrium A
okr.date.disclosure2001-02-28
okr.date.doiregistration2025-04-10T09:36:37.571879Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/2001/02/1003174/implicit-pension-debt-transition-cost-options-impact-chinas-pension-reform-computable-general-equilibrium-analysis
okr.globalpracticeMacroeconomics and Fiscal Management
okr.globalpracticeFinance and Markets
okr.globalpracticeGovernance
okr.guid864901468748479311
okr.identifier.doi10.1596/1813-9450-2555
okr.identifier.externaldocumentum000094946_01032007445537
okr.identifier.internaldocumentum1003174
okr.identifier.reportWPS2555
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2001/03/26/000094946_01032007445537/Rendered/PDF/multi0page.pdfen
okr.region.administrativeEast Asia and Pacific
okr.region.countryChina
okr.sectorPublic Administration, Law, and Justice :: Compulsory pension and unemployment insurance
okr.themeSocial protection and risk management :: Social safety nets
okr.topicPensions and Retirement Systems
okr.topicBanks and Banking Reform
okr.topicGovernance::National Governance
okr.topicMacroeconomics and Economic Growth::Economic Stabilization
okr.topicEnvironmental Economics and Policies
okr.topicFinance and Financial Sector Development
okr.unitEconomic Policy and Poverty Reduction Division, World Bank Institute
okr.volume1
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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