Tag Archives | Decomposition Analysis

The Inequality of Lifetime Pensions

Jiaxin Shi, Martin Kolk

Sociological Science October 17, 2023
10.15195/v10.a24


At older ages, most people are supported by pension systems that provide payments based on prior contributions. An important, but neglected, aspect of inequality in how much people receive in pensions is the number of years they live to receive their pension. We examine inequality in lifetime-accumulated pensions and show the importance of mortality for understanding inequalities in pension payments, and contrast it to inequalities in working-age earnings and yearly pension payments among older adults. In contrast to most previous research on old-age inequality comparing different social groups, we focused on total-population-level inequality. Using Swedish register data covering the retired population born from 1918–1939, we found that lifetime pensions are much more unequal than pre-retirement earnings and yearly pensions. Our findings also show that mortality explains more than 50 percent of the inequality of lifetime pensions within cohorts, and plays an important role in explaining changes in inequality across cohorts (192 percent among men and 44 percent among women). Pension policies can affect lifetime pension inequality, but such effects are limited in magnitude unless they directly affect the number of years of receiving pensions.
Creative Commons LicenseThis work is licensed under a Creative Commons Attribution 4.0 International License.

Jiaxin Shi: Max Planck Institute for Demographic Research, Rostock, Germany. Leverhulme Centre for Demographic Science & Department of Sociology, University of Oxford, Oxford, United Kingdom. Demographic Unit, Department of Sociology, Stockholm University, Stockholm, Sweden
E-mail: shi@demogr.mpg.de

Martin Kolk: Demography Unit, Department of Sociology, Stockholm University, Stockholm, Sweden. Institute for Future Studies, Stockholm, Sweden. Åbo Akademi University, Vaasa, Finland
E-mail: martin.kolk@sociology.su.se

Acknowledgements: We thank Jenn Dowd, Christian Dudel, John Ermisch, Martin Hällsten, Robert Hummer, Guanghui Pan, Fabian Pfeffer, Yifan Shen, Joshua Wilde, Alyson van Raalte, and participants at the Oxford Sociology Monday Meeting for their helpful feedback on previous drafts. Jiaxin Shi was supported by the European Research Council (grant no. 716323) and a Leverhulme Trust Grant (Grant RC-2018-003) for the Leverhulme Centre for Demographic Science at the University of Oxford. Jiaxin Shi gratefully acknowledges the resources provided by the International Max Planck Research School for Population, Health and Data Science (IMPRS-PHDS). Martin Kolk was supported by the Swedish Research Council (grant no. 2019-02552 and 2022-02314) and the Swedish Research Council for Health,Working Life andWelfare (FORTE, grant no. 2016-07115).

  • Citation: Shi, Jiaxin, and Martin Kolk. 2023. “The Inequality of Lifetime Pensions” Sociological Science 7: 667-693.
  • Received: May 24, 2023
  • Accepted: July 31, 2023
  • Editors: Arnout van de Rijt, Stephen Vaisey
  • DOI: 10.15195/v10.a24


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Income Inequality and Education

Richard Breen, Inkwan Chung

Sociological Science, August 26, 2015
DOI 10.15195/v2.a22

Many commentators have seen the growing gap in earnings and income between those with a college education and those without as a major cause of increasing inequality in the United States and elsewhere. In this article we investigate the extent to which increasing the educational attainment of the US population might ameliorate inequality. We use data from NLSY79 and carry out a three-level decomposition of total inequality into within-person, between-person and between-education parts. We find that the between-education contribution to inequality is small, even when we consider only adjusted inequality that omits the within-person component. We carry out a number of simulations to gauge the likely impact on inequality of changes in the distribution of education and of a narrowing of the differences in average incomes between those with different levels of education. We find that any feasible educational policy is likely to have only a minor impact on income inequality.
Richard Breen:  Nuffield College and Department of Sociology, University of Oxford.   Email: richard.breen@nuffield.ox.ac.uk

Inkwan Chung: Department of Sociology, Yale University.  Email: inkwan.chung@yale.edu

  • Citation: Breen, Richard, and Inkwan Chung. 2015. “Income Inequality and Education.” Sociological Science 2: 454-477.
  • Received: April 3, 2015.
  • Accepted: April 19, 2015.
  • Editors: Jesper Sørensen, Stephen Morgan
  • DOI: 10.15195/v2.a22

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