Abstract
Abstract The incidence of working for earnings beyond the normal pension age of 55 for females and 60 for males in urban China and Russia is investigated using micro-data for 2002, 2013, and 2018. Estimated logit models indicate that, in both countries, the probability of working after normal retirement age is positively related to living with a spouse only, being healthy, and having a higher education level. It is negatively associated with age, the scale of pension, and, in urban China, being female. We find that seniors in urban Russia are more likely to work for earnings than their counterparts in China. Two possible reasons that are attributable to this difference are ruled out, namely cross-country differences in health status and the age distribution among elderly people. We also demonstrate that working beyond the normal retirement age has a much stronger negative association with earnings in urban China than in urban Russia. This is consistent with the facts that the normal retirement age is strictly enforced in urban China and seniors attempting to work face intensive competition from younger migrant workers. We conclude that China can learn from Russia that it has a substantial potential for increasing employment among healthy people under 70.
Highlights
The People’s Republic of China and Russia share with high-income countries that their populations are becoming older
If people remain in the workforce longer, GDP will increase and the resulting higher tax revenues can be used to fund public programmes. This is a main motivation why we are trying to find out the reasons for older people in urban Russia and urban China to work after the normal retirement age and to explain why such situation is more common in urban Russia
What kind of difference exists between urban China and urban Russia regarding the size of the pension received after retirement, i.e., the degree of pension adequacy? Calculations based on the data for 2018, which we describe show no large cross-country difference in the average replacement rate as it is estimated at 53 percent for both men and women in urban Russia, 64 percent for males in urban China, and 66 percent for females in urban China
Summary
Any opinions expressed in this paper are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but IZA takes no institutional policy positions. The IZA Institute of Labor Economics is an independent economic research institute that conducts research in labor economics and offers evidence-based policy advice on labor market issues. Supported by the Deutsche Post Foundation, IZA runs the world’s largest network of economists, whose research aims to provide answers to the global labor market challenges of our time. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author
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