Women's Rights and Law

Does Giving Birth to a Child Affect a Female Employee's Pension Revenue?

Guo Yuhong
School of Economics and Management, South China Agricultural University
Financial Economics Research 2016-6

Abstract:By using individual-data stimulation method along with sensitive analysis of key variables and assumptions, this paper aims to calculate female employees' pension revenue with different birth decisions. It is found that, giving birth to a child will decrease the absolute value of a female's pension revenue. Such decrease is higher when she gives birth to the second child than the first one. Only when the growth rate of her salary is extremely low, the redistribution function of social pension's pooling fund can compensate her lifelong net present value. Therefore, only when a female employee decides not to give birth to any child or when the growth rate of her salary is extremely low, can she retain her pension revenue.It is advisable that our social pension policy should subsidize pension revenue for women with children to make effective compensation for the positive externality of their giving birth to children.
Keywords:pension insurance, two-child policy, birth decision, female employees

Paper type:Published