Household saving rates and the design of public pension programmes: cross-country evidence

Publication date: 27 Oct 2006 | Publication type: National Institute Economic Review | External Author(s): Disney, R. | Journal: National Institute Economic Review No. 198

I argue that the offsetting effect of public pension contributions on household retirement saving depends on how closely the public pension programme imitates a private retirement saving plan (i.e. the 'actuarial' content of the public pension programme) - the closer the design of the programme to a private retirement saving plan, the higher the offset. I estimate the determinants of household saving rates in a cross-country panel, augmenting standard measures of public pension programme generosity and cost by indicators that proxy the actuarial component of the programme. These indicators affect saving rates as predicted.

Keyword tags: 
pension reform, household saving