Research on the optimal ratio of central adjustment system for basic pension funds of enterprise employees: toward the policy goal of inter-provincial fund balance

BIAN Shu;ZHANG Mingzhi

Chinese Journal of Population Science,2019,No. 06

Based on a simulation of the central adjustment system in 2018–2050, the paper argues that the optimal policy goal is to equalize the inter-provincial pension fund balance. It is found that there is a U-shaped relationship between the adjustment ratio and the inter-provincial pension insurance gap, and the corresponding optimal adjustment ratio is 4.54% when the inter-provincial balance gap minimizes. The current adjustment plan has alleviated the structural contradiction between the fund payment pressure and the uneven distribution of inter-provincial balance in most provincial regions. The variance of inter-provincial fund balance has decreased by 63.01% in response to the current adjustment. The eastern provincial regions contributed the most, and the northeastern provincial regions benefited the most. The optimal adjustment plan gives the pension insurance fund more liquidity. The total adjustment scale and the total adjustment intensity are significantly improved, and the variance of inter-provincial fund balance is 77.17% lower. To avoid excessive adjustment, the paper suggests that the adjustment ratio should be increased to 4.5% to achieve the optimal adjustment effect.