| With the change of demographic, improving of medical conditions and living standards, the aged tendency of population in our country is speeding up obviously."National response to population aging strategic research" predicts that the elderly population in2013will exceed200billion, reaching202billion, the level of aging up to14.8%. In recent years, people pay more and more attention to the pension insurance, at the same times, the government also put it on an extremely important position.The most important indicator to evaluate pension scheme is pension replacement rate which is closely related to the social security system of a country. With no exaggerating to say, the pension replacement rate is the key points to the pension insurance system, the replacement rate is reasonable or not, will directly affect the merits of the pension system and living standards of retired employee. However, the existence of inflation and wage growth forces the pension replacement rate decrease with the increasing of time after retirement. Consequently, the life of the aged will fall into difficult, in order to prevent it’s happening, we must adjust the pension replacement rate constantly to ensure the basic livelihood of retirees and intergenerational equity.The central question in this paper is how to conduct a scientific and rational index adjustment under the current pension system in order to protect the interests of retired employees and reduce the financial pressure of pension insurance.In order to do a better research in this issue, this paper bases on the results of previous studies and sets "the Cairns absolute income hypothesis" and "the permanent income hypothesis of Friedman" as the theoretical foundation to establish a econometric model. The aim of this model is to find the relationship between the spending of different income groups and the actual average wages, at last we can design some adjustment programs of different level of protection. We divided this paper into six parts:the first part is an introduction, it introduces the research background and significance of this paper and the achievement of research in this issue at home and abroad; The second part describes the development process of Chinese insurance system and the fruitful achievement of the insurance reform in recent years, at last it introduces current provision in pension payment of Chinese and Liaoning Province after the pilot program, after the text of the calculations of replacement rate is based on this party; the third part is the calculation of the actual pension replacement rate of Liaoning Province, in this section, we define the replacement rate indicator deduces the formula of the target replacement rate based on the current provision in pension payment and makes a reasonable assumption of the parameters in the formula, the aim of all below is to calculates the actual replacement rate of Liaoning Province and makes the descriptive analysis of this data; the fourth part is the theoretical basis of pension replacement rate indexation, this section describes the principle and objectives of indexation, cites the adjustment program has been used all around the world. After making analysis and comparison of the advantages and disadvantages of each alternative and combining Chinese actual situation, we determine the adjustment programs suitable for China, the theoretical describing in this part of and calculation of the replacement rate given below is the bases of the specific design; The fifth part is the indexation program design of Liaoning Province, actually, determine the adjustment factor is the key to design, this paper bases on the results of previous studies and sets "the Cairns absolute income hypothesis" and "the permanent income hypothesis of Friedman" as the theoretical foundation to establish a econometric model. The aim of this model is to find the relationship between the spending of different income groups and the actual average wage to design some adjustment programs of different level of protection, at last we choose the best program which has internal efficiency and external efficiency; the sixth part is conclusion and policy proposal. After the system analysis in this paper, we can system propose four indexation programs and examine the overall efficiency of the four programs.The results are as follows:Set the wage growth as adjustment index can give retired employees the highest level of protection, so that retired employees can share the fruits of economic development of society, so this program have the highest internal efficiency. However, this program has a greater demand for pension funds, and it will lead to worker and firm’s contribution rate become higher and higher, at last, it will affect the worker’s enthusiasm for work and business reinvestment and affect the economy sustainable development.The program which set the rate of inflation as adjustment index and the program which keep the food and clothing level not lower before retiree lead to worker and firm’s contribution rate become higher and higher, however because of its lower adjustment index, it can’t well protect the elderly life after retirement, so far as the retired employees concern it is not fair, at the same times, if the life after retirement can’t be well protected, the sense of security of citizens will lose, and ultimately affect social stability, these two programs have external efficiency, but they do not have internal efficiency.Only the program which is keeping the basic livelihood of retirees without reducing is both internal efficiency and external efficiency. On one hand, this program can withstand the risk of inflation to protect the basic livelihood of old age retirees, on the other hand, this program don’t lead to worker and firm’s contribution rate become higher and higher, so it is fit to Chinese economic development level. Accordingly, taking both internal efficiency and external efficiency into consider, the program which keeping the basic livelihood of retirees without reducing is modest indexation adjustment programs. |
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