
Contents
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Why Do Pension Systems and Reforms Have a Gender Impact? Why Do Pension Systems and Reforms Have a Gender Impact?
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Key Design Features of the Old and New Systems Key Design Features of the Old and New Systems
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Methodology Methodology
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Data Data
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Simulations Simulations
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The Old System Counterfactual The Old System Counterfactual
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Retirement Income for Women versus Men in the New System Retirement Income for Women versus Men in the New System
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Income from Women's Own‐Annuities Income from Women's Own‐Annuities
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Income from the Public Benefit Income from the Public Benefit
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Income from Joint Annuities Income from Joint Annuities
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Total Lifetime Pension from Own‐Annuity, Public Benefit, and Joint Annuity Total Lifetime Pension from Own‐Annuity, Public Benefit, and Joint Annuity
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Women's Benefits Relative to Men Before and After Reform Women's Benefits Relative to Men Before and After Reform
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A Priori Expectations about the New versus the Old Systems A Priori Expectations about the New versus the Old Systems
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Results: Gender Ratios under the New and Old Systems Results: Gender Ratios under the New and Old Systems
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Which Subgroups Benefited (or Lost) the Most? Which Subgroups Benefited (or Lost) the Most?
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Single Women Single Women
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Implications for Social Security Reform in Other Countries Implications for Social Security Reform in Other Countries
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Caveats and Gaps Caveats and Gaps
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Notes Notes
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References References
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4 Chapter 4 The Gender Impact of Social Security Reform in Latin America
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Published:November 2007
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Abstract
Over the past two decades many countries have adopted multipillar pension systems that include both a public DB and a private DC pillar. Critics of these pension reforms argue that the tight link between payroll contributions and benefits in the DC pillar produce lower pensions for women. In contrast, supporters of these reforms argue that multipillar systems remove distortions that favour men and permit a more targeted public pillar that help women. This chapter examines the differential impact on genders of the new and old systems in Chile, Argentina, and Mexico. In all three cases, the new social security system includes two mandatory components: privately managed funded individual accounts (DC) and a publicly managed and financed safety net. Women accumulate retirement funds and private annuities from the DC pillar of the multipillar systems that are only 30-40% of those of men. This effect can be mitigated by introducing two critical elements into the new systems: (a) targeting the new public pillars toward low earners, because the majority of low earners are women, and (b) restricting payout provisions such as joint annuity requirements. With these modifications, total lifetime retirement benefits for women would reach 60-80% of those for men. For ‘full-career’ married women, they would equal or exceed benefits of men.
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