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Gender gap in pension savings: Evidence from Peru’s individual capitalization system∗

Author

Listed:
  • Javier Olivera

    (Departamento de Economía de la Pontificia Universidad Católica del Perú.)

  • Yadiraah Iparraguirre

    (Pontificia Universidad Católica del Perú.)

Abstract

We study the gender gap in pension funds in Peru, a country where the main pension system is based on individual retirement accounts. We exploit randomly selected samples of administrative pension fund individual registers collected between 2005 and 2019 and find a gender gap in favour of men at each percentile of the distribution of pension funds. The unconditional gender gap decreases along the percentiles until it reaches a sort of “glass ceiling” around the 85th percentile, and then it increases substantially. We also detect heterogeneity by birth cohorts, indicating that older cohorts show higher gender gaps in pension saving because of the capitalization process. Moreover, we find that awareness about pension fund risk management –a proxy for financial literacy– increases the dispersion of pension savings over the distribution and, therefore, increases inequality and the gender gap. This situation is aggravated by the fact that Peru has very low levels of financial literacy JEL Classification-JE: D31, G23, J16, J32.

Suggested Citation

  • Javier Olivera & Yadiraah Iparraguirre, 2022. "Gender gap in pension savings: Evidence from Peru’s individual capitalization system∗," Documentos de Trabajo / Working Papers 2022-513, Departamento de Economía - Pontificia Universidad Católica del Perú.
    • Handle: RePEc:pcp:pucwps:wp00513
    DOI: 10.18800/2079-8474.0513
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    References listed on IDEAS

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    More about this item

    Keywords

    Gender gap; Pension savings; Financial literacy; Unconditional quantile; Peru.;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions

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