The Economic Effects And Policy Options Of Delayed Retirement Age

For half a century, China's retirement policy institutional framework has been no significant change. But with the continuous social and economic development, the average life expectancy of residents and the education years of labor force continues to increase. That makes our current retirement system exists anachronism place, the reform of retirement systems has to meet the social development needs. At present, policy makers have been formally put on the agenda delay retirement and plans to publish specific delay retirement program in 2017. This initiative which aims to deal with the increasingly serious problem of aging mainly based on two considerations:First, ease pension gap, providing conditions for the reform of the pension system; The second is to deal with the shortage of labor supply as the "demographic dividend" disappeared. In the future, the decline of China's working age population has become an indisputable fact, and the age structure of the working age population will also be significant changes according to the prediction of this paper. So the timely introduction of delay retirement policy has become an important measure to ease pressure of future labor supply even usher the "second demographic dividend".The thesis using the dynamic CGE modeling techniques to study the economic effect and policy options of delay the retirement age from the perspective of labor supply. That mainly includes two aspects:First, construction a recursive dynamic CGE model which can fit Chinese economy operation and the regeneration of SAM accounts. Second, take advantage of the superiority of CGE model which on policy assessment and forecast to analysis the economic effect of delay retirement age. By that to provide quantitative results and directional reference analysis for further improvement and optimization of delay retirement policy.Firstly, this thesis compiles a macro-SAM table of 2010 based on IO extend tables, then we research the method of combination of micro survey data and the preparation of the SAM in detail to provide a new way of thinking and methods of SAM account refinementSecondly, this thesis introduces the basic structure of the CGE model. Then author examine the model fitness with Chinese economic operation from GDP and industrial output to ensure the reliability and validity of our simulation results, and to create the conditions for later "counterfactual" simulation's design and implementation.Thirdly, when the model construction completely, we design two "counterfactual" simulation by compressing the delay retirement policy implementation time cycle. Found that: (1) The delay of retirement age can significantly increase the supply of labor market which can stimulate consumption, investment and trade and thus promote economic growth of China's macroeconomic; (2) Since the status of China's current labor structure, delayed retirement policies would reduce the level of industrial services, but the industry structure rationalization level will be increased because labor and capital factors have been more rational utilization. (3) Delay the retirement age will not cause a decline in wages in any age group, but will affect its growth rate. Ageing Labor force wage growth rate will suffer a greater negative impact due to the law of supply and demand and its supply elasticity. And there are no obvious replacement relations between youth and aging labor force according to our simulation results. Delay retirement policy does not have negatively impact on the young labor force employment, but will bring a positive effect.Fourthly, this paper design four representative policy programs based on international experience and domestic views on delay retirement policies. Then, we calculate the growth of labor force of this four scenarios by constructing a population forecast model, and based on that, we compare the economic consequences of different scenarios. Based on simulation results and analysis, we consider that the delay retirement program should postpone the retirement age to 65 years both man and woman for a better economic performance, and the time span which continued 25-30 years is appropriate..Finally, this thesis puts forward to the suggestions of China's delay retirement policy, and points out the defects of this research.