Saving for Old Age

43 Pages Posted: 19 Jul 2016

See all articles by Asli Demirgüç-Kunt

Asli Demirgüç-Kunt

World Bank

Leora F. Klapper

World Bank; World Bank - Development Research Group (DECRG)

Georgios A. Panos

University of Glasgow - Adam Smith Business School

Date Written: June 2, 2016

Abstract

Countries around the world face a retirement crisis brought on by aging populations, declining birthrates, and fiscal shortfalls. As a result, policy makers increasingly seek to understand retirement savings patterns, a crucial component of the safety net for the elderly. Drawing on the 2014 Global Findex database, which provides individual-level data on the use of financial products in more than 140 countries, this paper examines how adults save for old age. It finds that about 25 percent of adults worldwide save for old age, with rates exceeding 35 percent in high-income Organisation for Economic Co-operation and Development economies and the East Asia and Pacific region. On average, men are slightly more likely than women to save for this purpose, but the gender gap is deeper in developing countries. Worldwide, saving for old age is more common among older adults, more educated adults, and adults who own accounts. Adults in countries with English legal origin, and with high savings rates, are also more likely to save for old age. The paper also finds that measures to increase trust in the financial system, such as the safety net/moral hazard index based on deposit insurance, lead to higher rates of saving for old age. Finally, the paper finds little evidence of substitution between pension system provisions and contribution rates with saving for old age.

Keywords: Industrial Economics, Economic Theory & Research, Economic Conditions and Volatility, Social Protections & Assistance, Economic Growth

Suggested Citation

Demirgüç-Kunt, Asli and Klapper, Leora F. and Panos, Georgios A., Saving for Old Age (June 2, 2016). World Bank Policy Research Working Paper No. 7693, Available at SSRN: https://ssrn.com/abstract=2811340

Asli Demirgüç-Kunt (Contact Author)

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Leora F. Klapper

World Bank ( email )

1818 H Street, N.W.
Washington, DC 20433
United States
202-473-8738 (Phone)

HOME PAGE: http://econ.worldbank.org/staff/lklapper

World Bank - Development Research Group (DECRG)

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

Georgios A. Panos

University of Glasgow - Adam Smith Business School ( email )

Gilbert Scott Building
University Avenue
Glasgow, Scotland G128QQ
United Kingdom

HOME PAGE: http://https://sites.google.com/site/georgiosapanos/

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