• The Korean Journal of Applied Statistics
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• v.28 no.4
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• pp.603-620
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• 2015

The National Pension of Korea is a public social security system designed to alleviate social risks and poverty that has had a major impact on the quality of life for the aging population. However, a rapidly aging population and low fertility threaten the sustainability of national pension in Korea. The National Pension Research Institute publishes a nancial projection every ve years; consequently, the government has lowered the entitlements for the sustainability of national pension based on the projection results. The current reform of the pension system that arbitrarily reduces the entitlements might detract from the income security role of the national pension for pensioners without accounting for the highest elderly poverty rate in the OECD countries. We first discuss methods for the financial projection of the national pension in terms of population, subscribers, and pensioner projections in order to estimate the pension reserve fund and the financial depletion year. We also conduct a sensitivity analysis for population variables, institutional variables, and economic variables based on pension reserves and the financial depletion year. We evaluate intergenerational fairness between the income hierarchy by conducting a money's worth analysis. Finally, we investigate the possibility of the sustainability of national pension by adjusting pension contributions and entitlements (income replacement rate). A new dependency ratio shows that a simple reform of the national pension does not secure the sustainability of the national pension without adapting a pay-as-you-go system.

• 한국사회복지학회:학술대회논문집
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• 2004.04a
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• pp.457-473
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• 2004

This study purports to contribute to existing literatures and debates about the future of Korean public pension system by introducing the cases of pension privatization in eight Latin American countries. Following the Chilean reform in 1981, many Latin American nations to a varying degree replaced their public pension system with private one, and the performance of those private systems started to emerge. Overall, pension privatization does not appear to be the panacea that some of its advocates have argued. While it seems to remedy existing problems, it is creating new ones. As an unprecedented policy experiment, the pension privatization in many Latin American countries implies that there are a number of risks in the path of privatization.

• The Korean Journal of Applied Statistics
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• v.28 no.4
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• pp.741-762
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• 2015

This study examines the long-term prospects for a minimum living guarantee by public pensions for the elderly using a dynamic micro-simulation model. "Elderly poverty" here is an estimate calculated by considering only the public pension income and it means how public pension affects the minimum living guarantee for the elderly. The main results are: First the impact of the public pension system on elderly poverty can be decomposed into economic growth and institutional effect. When considering both effects, the absolute poverty rate of the elderly will be reduced to 20% by the year 2040. But when considering the institutional effect(except economic growth effect), that rate is expected to be a long-term level of around 90%. Second, even if the Basic Pension is indexed to 10% of A-value, the elderly poverty rate is only about 10%p to be reduced further, compared to the current CPI-indexed system. Third, current benefit formula for National Pension does not consider the actual correlation of income level and insured period; consequently, the reversal possibility of the replacement rate appears likely. Fourth, the reform of 2007 improves the sustainability of the National Pension; however, it deteriorates the adequacy of the pension policy, i.e., the past system would be better than the current system in regards to a reduction in elderly poverty. Further discussion is needed on aspects of correct pension reform assessments which is difficult to achieve without understanding the comprehensive benefits and costs to society.

• Korean Journal of Social Welfare
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• v.51
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• pp.5-28
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• 2002

The purpose of this paper is to examine the issues and the characteristics of the recent social security pension debate in the United States. For the purpose the transforming process from the funded system to the pay-as-you-go system in the 1930s, three alternatives of social security reform proposed by the Social Security Administration in 1996, and the other various alternatives proposed by the politicians, the business leaders and the scholars were analysed. While the alternatives were compared, the critical issues could be identified. The core issues were as follows. First, the individual accounts should be newly made or not? Second, who is the main administrator, government or private investment companies? Third, what is important, the inter-generational and the vertical income redistribution effect or the individual equity in social security pension system? Besides, the different positions of the social forces were also examined. The supporters of privatizing the social security pension, supporters of IA and PSA, prefer the value of equity, the effect of promoting savings, the private management of the social security funds, and the investment of the funds to the private capital markets. The supporters of pay-as-you-go system, supporters of MB, prefer the inter-generational and the vertical income redistribution effect of social security pension, and were convinced that fundamental changes of the systems are not necessary, and the insolvency problem could be overcome through a few reform, for example, increasing the rate and decreasing the benefits.

• 한국사회정책
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• v.24 no.2
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• pp.31-60
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• 2017

This paper aims to reveal the background and issues of the current reform proposals for social insurance in Germany and to draw their implications for Korea. The essence of the German social insurance crisis is that of normality of industrial society on which it has been based, revealing itself by the dual crisis of finance and dualization. Reform proposals are regarded as diverse responses to the crisis of the normality within individual social insurance schemes. They are searching for transforming health insurance into citizen's insurance, pension insurance into various alternatives including all worker's insurance and citizen's pension, unemployment insurance into employment insurance. One of the commonalities of the them is that they attempt to reconstruct the old normality. However, due to the economic recovery, the historical experiences of improving social insurance, and high satisfaction, they are expected to struggle with the gradual improvements rather than radical shift from their tradition. In Korea, where the maturity of social insurance is low, it is necessary to mark the crisis faced by German social insurance as a teacher. We need to go back to the fundamental spirit of social policy and redraw the blue prints of social policy by opening minds to plentiful alternatives in the eyes of normality reconstruction.

• 한국사회정책
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• v.25 no.3
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• pp.279-303
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• 2018

Since the introduction of the Riester Pension Scheme, the controversy has continued in the policy studies and the political debates. This study evaluates the achievements and limitations of the German Riester pension scheme and tries to derive policy implications for South Korea. As a result of the analysis, the most worthwhile achievement of the Riester Pension is to strengthen the role of the private pension schemes. Unlike other private pension schemes, it included a large part of lower income households. It also opened a new perspective of utilizing private pension schemes to accomplish the goals of the family policy. Despite these attainments, it does not reach the promised coverage rate. It also was revealed that the higher income households have concluded more Riester Pension Contracts than the targeted lower-income households. Due to high administration fee and incomplete information problems, benefit levels are supposed to be much lower than expected. It concludes, above all, despite some achievements, the Riester Pension Scheme will not fill completely the gap of old age income security caused by the reduction of the public pension system. The German case provides fruitful lessons for Korea. The introduction of a subsidized personal pension scheme in South Korea can be realized only when some prerequisites would be satisfied such as the consolidation and maturing of public pension schemes and the strengthening of the transparency in the private pension market.

• The Korean Journal of Applied Statistics
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• v.28 no.4
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• pp.643-661
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• 2015

Korea Teachers Pension (private school pension) is a mandatory pension and a social security system for private school teachers to ensure the stability of subscribers by a supplying pension when they (and their dependents) face future economic risk due to retirement or death. Therefore, the Teachers Pension must provide stability and sustainability in regards to adequacy of income and to function as a pension. However, the Government Employees Pension System (GEPS) of Korea (the most representative special occupation pension) recorded a fiscal deficit in 2001 and with an accumulated deficit that is expected to grow; subsequently, various plans for the reform of GEPS have been actively discussed. The Korea Teachers Pension system is based on the GEPS scheme and is not free from the GEPS discussions on reforms of national pension. The current system for the Teachers Pension needs to be improved because it is expected to be depleted within the next 30 years due to low fertility and an aging population in Korea. This study discusses existing Teachers Pension schemes problems and suggests a projection method and revised plans to improve it. We use long-term financial projections of the Teachers Pension to estimate the fund exhaustion point and the minus balance of the financial scale as well as analyze the supply-demand burden structure that reflects the future population structure to propose Teachers Pension reforms that will improve stability and adequacy.

• Korean Journal of Social Welfare
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• v.66 no.3
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• pp.231-251
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• 2014

Recently, Korean government documented the plan to cope with the situation related to rich pensioners of Basic old-age pension. The purpose of this paper is to verify that how many rich pensioners are existing and to evaluate government reform plan's validity and effect. Main results are as follows; firstly, if the definition of rich pensioners is on the top 10%, the proportion of them would form 2.9% of total. And then, an amount of expenditure for them is only 2.6% of total. Secondly, in terms of disposable income, debt, and transfer income from child, the household who would be applied by government's plan is not richer than other household who is in the same living standard. And then, if the government's plan enforced, the effect might be very small. Lastly, the plan of government will discriminate against persons who support their parent. As a result, Basic old-age pension will be worsen. This paper should underline that the government's reform is only the 'hidden' retrenchment strategy in order to introduce a standard of the obligation to support own parent in the state without scientific prediction and serious discussion of negative public opinion. That is why, this is the same as the 'Trojan Horse'.

• The Journal of the Korea Contents Association
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• v.20 no.10
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• pp.522-534
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• 2020

The purpose of this study is to suggest practical ways to improve the 5th Government Employees Pension System(GEPS) in the near future. This article surveyed the civil servants cognition in three different levels(validity, feasibility, efficiency) by Q methodology. The value and mean of GEPS in the validity level, procedure and participants of GEPS reform process in the feasibility level, and contribution rates, benefit rate, replacement rate of GEPS in the efficiency level were analyzed. There is no successful policy without securing compliance and acceptance of implementation organization and target group. So next 5th GEPS reform could proceed successfully when it took into account civil servant's-who is the implementation group and target group- thought about variances of the 3 levels of GEPS.

• Korean Journal of Social Welfare
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• v.58 no.3
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• pp.135-168
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• 2006

This study reviewed pension reform's overall characteristic and(anticipated) positive negative effect in OECD countries's and then analysed middle-old age's retirement transition and determinants of full/gradual retirement through the $3{\sim}7th$ Korea Labor and Income Panel considering that Korea has been aging society quickly and it is necessary to suggest not only solution of early retirement and working age reduction but also pension reform. As a result of this study, about 1/4 of 50 years and older have been continuing to work through various pathways after retirement and 98% among fully retired older who passed by re-employment step of occupational status including retirement are still searching for jobs. This showed that it is also inappropriate to typical retirement concept itself on the lines of labour market participation in Korea and part-time/temporary work or self-employment have been used by means of alternatives of maintaining works for middle-old ages. However, the duration of changed occupational status of gradual retirees is mostly only $1{\sim}2$ years. Therefore it is necessary to support the gradual retirement to minimize a term of income insecurity and promote the work of the old ages who have will and capacity of work. Most of all, partial pension system which is main program of gradual retirement, should make the rules that beneficiaries are those who age less than pensionable age and benefit levels should be actuarial fairness together with pension system and provide substantial help. But, the introduction of partial pension system is not the only way to solve and needs overall social economic approach. Especially guarantee the increase of quantitative qualitative employment for middle-old ages linking labor market policy and supporting gradual retirement not ought to be abused to force the part time works and early retirement route against their own will.