본문 바로가기
  • Home

Evaluation and Implications of the German Riester Pension Scheme

KIM, Won-Sub 1

1고려대학교

Accredited

ABSTRACT

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 utiliz ing private pension schemes to accomplish the goals of the family policy. Despite these attain ments, it does not reach the promised coverage rate. It also was revealed that the higher in come 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 in come security caused by the reduction of the public pension system. The German case pro vides 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 con solidation and maturing of public pension schemes and the strengthening of the transparency in the private pension market.

Citation status

* References for papers published after 2022 are currently being built.