Research On The Impact Of Delayed Retirement On China’s Pension Gap Under OLG Framework

In the context of the aging of the population,the pressure on China’s pension budget has gradually increased,and the current financial subsidies are relied on to achieve a balance of income and expenditure.Due to the mismatch between China’s current legal retirement age and the current population life expectancy,delaying retirement will become an essential policy option to deal with the above problems.China may begin to promote the specific issue of delayed retirement in the near future.In addition,the problem of empty pension accounts in personal accounts restricts the improvement and development of China’s pension insurance system.In recent years,this problem has attracted the attention of the state,and the proportion of empty accounts in pension personal accounts has slowly declined,but it is still at a high level.Focusing on the pension gap,this paper selects the proportion of fiscal pension insurance expenditure and the proportion of financial pension insurance expenditure to total output as the collection indicators reflecting the scale of pension gap,and studies the impact of delayed retirement on pension gap under the background of improving pension personal accounts and population age structure changes.Based on the life cycle theory and the principle of personal utility maximization,this paper introduces delayed retirement,"combination of PAYG and FF" pension insurance system,"empty accounts" of personal account pensions,and financial subsidies for pension insurance,life expectancy,fertility rate and other factors to the classic general equilibrium overlapping generation model,and solve the analytical solutions of various economic indicators at the steady-state equilibrium.According to the existing research and the reality of China,the reasonable values of relevant parameters and model calibration are carried out.Then the impact of delayed retirement together with its mechanism on economic variables such as the scale of pension gap were analyzed.The effects of delayed retirement on pensions gap under the background of improving individual pension accounts in different ways and population age structure changes were further simulated.The study found that:first,delaying retirement can effectively reduce the pension gap.Second,improving the personal pension account by increasing the proportion of empty accounts does not change the effect of delaying retirement on reducing the pension gap,but it will greatly expand the pension gap even lead to the collapse of the pension system.Third,improving individual pension accounts by reducing the proportion of empty accounts will also not change the effect of delayed retirement on the pension gap,and will expand the pension gap,but the magnitude is smaller than the former under the condition of maintaining the sustainability of the pension system.Fourth,in order to achieve intergenerational fairness,the government should use both methods to improve individual pension accounts.But in the process of delaying retirement,reducing the pension gap,maintaining intergenerational fairness and improving individual pension accounts cannot be realized at the same time.Fifth,the life expectancy extension and fertility decline accompanying the gradual delay in retirement will partially or completely offset the effect of delayed retirement on reducing the pension gap.Based on the research conclusions,this paper puts forward five policy suggestions:First,implement the delayed retirement policy as soon as possible.Second,gradually improve the personal pension account in the process of gradually delaying retirement,and broaden the sources of funding beyond financial subsidies.Third,adopt measures to increase the fertility rate.Fourth,scientifically adjust the payment of pensions in personal accounts and appropriately reduce the level of pension benefits in personal accounts.Fifth,improve the multi-pillar pension insurance system,appropriately weaken the protection level of basic pension insurance,and promote annuities and personal commercial pensions as a private supplement.