Role of public and private pension benefits in financing elderly household consumption－Comparison of OECD countries

Tatsuya Ishikawa

1――Introduction： Aging and its implications for the pension system
2――International comparison of pension benefits and fund assets using macro level data
3――International comparison of retired household income and consumption using micro level data
4――Trends in private pension benefits and contributions of Japanese households
5――Concluding remarks

Due to rising life expectancy and declining fertility, aging is now a global phenomenon. The trend is particularly pronounced in developed countries as a whole, where the population aged 60 and over has already surpassed the young population under 15. According to a report by the U.N. entitled “World Population Prospects 2008 Revision,” the former is expected to become twice the size of the latter by 2050. Japan is the first advanced country to begin decreasing in total population, and its proportion of elderly persons aged 65 and over is the world's highest, reaching 22.6% as of 2010. As shown in Table-1, the speed of aging is surprisingly rapid. Until the mid 1980s，the proportion of elderly persons in Japan was low even among OECD countries. But the proportion subsequently shot up from 10% in 1985 at an accelerating pace, and took only 20 years to reach 20%.