| We estimate the impacts of social security programs on the retirement behavior in Korea and China. We use the micro data from the Korea Labor and Income Panel Study to calculate the social security wealth (SSW) and three incentive measures: accrual, option and peak values. We apply probit regression models to quantify the effect of the National Pension Scheme in Korea on individual decisions of Korean workers. Empirical estimation shows that in Korea the estimated effects of the incentive measures on retirement are negative and significant in most of our models. The SSW plays au important role indirectly, and its signs are different in different models. We conduct a plus-five-year policy simulation to show the magnitude of the impact and how individual workers would respond to policy changes. For China, we analyze the age distributions of the SSW and the incentive variables, using the micro data from the China Health and Nutrition Survey. We compare the two systems from an institutional point of view. |
