A Study On The Income Distribution And Financial Burden Of The Endowment Insurance Of Urban And Rural Residents In

Pension insurance is related to the well-being of the residents. It not only has the function of insurance, but also have income redistribution effect by different design of pension insurance premiums and the way that pension is calculated. Meanwhile, the government financial subsidies to the pension insurance is an important support of the redistributive effects.The government of Chengdu firstly introduced urban and rural residents’pension insurance pilot scheme for urban and rural residents in Chengdu under the trend of an aging population and the balance between urban and rural social security system. It is different from the new agricultural pension insurance and old-age insurance system for urban residents in the design of contribution grades and government subsidies.According to the design of the pension insurance system for urban and rural residents in Chengdu, this paper builds the actuarial model and uses net benefits, replacement rate and the fiscal burden of government as three indicators to examine the effects of income redistribution and the level of financial burden. The results indicate that the pension insurance is generally conducive to the younger generation and tend to give rise to regressive income transfer. The financial burden of the provincial government and the local government of Chengdu is not large, and the provincial subsidy shares most of the pressure.The policy implications of this paper is that different pay grades of pension contributions should be given a different subsidies ratio and improve the income level of the personal accounts for people who choose lower pay grades to protect the benefits from pension insurance subsidies of low-income people.