Estimation of households’ preferences for reforms in employee public pension plan in Japan(in Japanese)

We investigated households’ preferences for reforms in employee public pension plan in Japan using a choice experiment. We considered five policy approaches: increasing contribution rate, decreasing pension benefit, increasing pension age, increasing the variation in pension benefit by allowing more equity investments, and increasing consumption tax. We found that households required an increase (1) of JPY 19, 810 in the monthly pension benefit for accepting a one-year increase in pension age; (2) of JPY 4, 510 for a 1% increase in contribution rate; and (3) of JPY 3, 530 for a 1% increase in consumption tax. These results indicate that among the above policy approaches, an increase in pension age is the most unpopular. An increase in consumer tax is preferred over an increase in contribution rate. In addition, households are willing to lower the monthly benefit by JPY 2, 270 for a 1% increase in risk of benefit. This indicates that households are willing to increase investment risk—such as by allowing more equity investments—to avoid immediate increases in contribution rate and consumption tax. As for the difference between the participants’ and beneficiaries’ preferences, we found that while participants required an increase of JPY 5, 630 in the monthly benefit for accepting a 1% increase in consumption tax, beneficiaries showed no preference. This indicates that beneficiaries are tolerant of increased consumption tax.