The impact of investment and social factors on pension savings in Kazakhstan
-
DOIhttp://dx.doi.org/10.21511/imfi.20(3).2023.09
-
Article InfoVolume 20 2023, Issue #3, pp. 102-115
- Cited by
- 343 Views
-
111 Downloads
This work is licensed under a
Creative Commons Attribution 4.0 International License
In the current social conditions, pension systems have become the most important topic on the agenda for many countries. Therefore, governments have started paying attention and should reform their pension systems to guarantee an adequate contribution to pensions. Thus, this study analyzes the impact of investments and social factors on pension savings using Kazakhstan as an example. The paper is based on secondary data from the annual reports of the Unified Accumulative Pension Fund and annual statistical reports of the Bureau of National Statistics of the Republic of Kazakhstan from 2014 to 2022. SPSS software was used to analyze the collected data, specifically through correlation and regression analysis, to determine the impact and relationships between selected indicators (i.e., inflation rate, number of contributors, pension contribution, investment income and average wage). To check the reliability of the models, Fisher’s F-test and Student’s t-test were conducted. Therefore, a VIF diagnosis was conducted. The correlation analysis results showed that in the group of investment factors, pension savings are more dependent on pension contributions (,900**), and in social factors, on average wages (1,000**). Based on the results obtained, all factors have a positive impact on pension savings, except inflation. Inflation growth by 1% on average reduces the amount of pension savings by 23% over the nine-year period between 2014 to 2022, which is reflected in the results of Model 2. The study’s results can be applied to managing pension funds and reforms related to the pension system.
Acknowledgments
This research was funded by the Science Committee of the Ministry of Science and Higher Education of the Republic of Kazakhstan (Grant “Exploring the impact of economic, social, and environmental factors on the relationship between urbanization and greenhouse gas emissions” No. AP19576071).
- Keywords
-
JEL Classification (Paper profile tab)E21, E27, H55
-
References40
-
Tables7
-
Figures2
-
- Figure 1. Levels of the pension system in Kazakhstan
- Figure 2. Independent variables normality distribution (Model 1, Model 2)
-
- Table 1. Description of variables
- Table 2. Peculiarities of pension components
- Table 3. Statistical data on indicators from 2014 to 2022
- Table 4. Spearman’s correlation
- Table 5. ANOVA: F-test
- Table 6. Coefficients: t-test, VIF
- Table 7. Hypothesis testing results
-
- Abikenov, A., Kenzhibekova, E. P., Kalkayeva, N., Taitorina, B. A., Buribayev, Y. A., & Khamsins, Z. A. (2021). The Model of Pension System in Chile: Transformation in Kazakhstan. Kasetsart Journal of Social Sciences, 42(1), 117-122.
- Agarwal, S., Pan, J., & Qian, W. (2019). Age of decision: Pension savings withdrawal and consumption and debt response. Management Science, 66(1), 43-69.
- Attanasio, O. P., & Rohwedder, S. (2003). Pension wealth and household saving: Evidence from pension reforms in the United Kingdom. American Economic Review, 93(5), 1499-1521.
- Baltas, I., Dopierala, L., Kolodziejczyk, K., Szczepański, M., Weber, G. W., & Yannacopoulos, A. N. (2022). Optimal management of defined contribution pension funds under the effect of inflation, mortality and uncertainty. European Journal of Operational Research, 298(3), 1162-1174.
- Berezina, S. (2017). Perspectives of accumulation of funds in the accumulative pension insurance system of Ukraine. Investment Management and Financial Innovations, 14(2), 128-138.
- Bongini, P., & Cucinelli, D. (2019). University students and retirement planning: never too early. International Journal of Bank Marketing, 37(3), 775-797.
- Chen, D. H. J., Beetsma, R. M. W. J., & Van Wijnbergen, S. J. G. (2020). Unhedgeable inflation risk within pension schemes. Insurance: Mathematics and Economics, 90, 7-24.
- Committee on Statistics of the Ministry of National Economy of the Republic of Kazakhstan (QAZSTAT) (2020). Statistics [Labor and Income for 2014-2022].
- Cupák, A., Kolev, G. I., & Brokešová, Z. (2019). Financial literacy and voluntary savings for retirement: novel causal evidence. The European Journal of Finance, 25(16), 1606-1625.
- Dalen, H. P., Henkens, K., & Hershey, D. A. (2010). Perceptions and expectations of pension savings adequacy: A comparative study of Dutch and American workers. Ageing & Society, 30(5), 731-754.
- Etgeton, S. (2018). The effect of pension reforms on old-age income inequality. Labour Economics, 53, 146-161.
- Gerrans, P., Moulang, C., Feng, J., &Strydom, M. (2017). Individual and peer effects in retirement savings investment choices. Pacfin.
- Grishchenko, N. (2016). Pensions after pension reforms: A comparative analysis of Belarus, Kazakhstan, and Russia. Procedia Economics and Finance, 36, 3-9.
- Hagen, J. (2018). The effects of increasing the normal retirement age on health care utilization and mortality. Journal of Population Economics, 31(1), 193-234.
- Horneff, V., Maurer, R., & Mitchell, O. S. (2018). How persistent low expected returns alter optimal life cycle saving, investment, and retirement behavior (No. w24311). National Bureau of Economic Research.
- Hutabarat, A. S., & Wijaya, C. (2020). Analysis the effect of financial literacy on financial planning for retirement (case study lecturers and administrative staffs in Universitas Indonesia). The International Journal of Management, 11(5), 741-750.
- Ibiwoye, A., & Adesona, A. T. (2011). Analyzing the cost of minimum guarantee in mandatory capitalized pension system: a Nigerian example. Insurance Markets and Companies, 2(2).
- Joint Stock Company “Unified Accumulative Pension Fund” (“UAPF”) (2023). Pokazateli po pensionnym aktivam za 2014-2022 [Indicators on pension assets for 2014-2022]. (In Russian).
- Junusbekova, G. A., & Zhaumitova, M. D. (2020). The efficacy of the retirement pension provision system: Modeling, and assessing of the case of Kazakhstan. Journal of Open Innovation: Technology, Market, and Complexity, 6(4), 158.
- Kangalakova, D. M., & Sabden, O. (2017). Methods of assessment of efficiency of small and medium-sized enterprises in developing countries: Experience of Kazakhstan. International Journal of Economic Research, 14(7), 47-57.
- Kerimov, A., Babayev, A., Ashurbayli-Huseynova, N., & Gubadova, A. (2023). Effectiveness of anti-inflation policy that ensures economic growth: Evidence from post-Soviet countries. Problems and Perspectives in Management, 21(2), 542-555.
- Kireyeva, A.A., Kredina, A., Vasa, L., & Satpayeva, Z.T. (2021). Impact of financial technologies on economic development: Theories, methods and analysis. Journal of International Studies, 14(4), 286-303.
- Koval, N., Priamuhina, N., & Zhmurko, I. (2020). Analysis of economic-financial experience of the world countries in the system of pension insurance. Baltic Journal of Economic Studies, 6(1), 1-8.
- Liu, T., & Sun, L. (2016). Pension reform in China. Journal of Aging & Social Policy, 28(1), 15-28.
- Lukyanets, A., Okhrimenko, I., & Egorova, M. (2021). Population aging and its impact on the country’s economy. Social Science Quarterly, 102(2), 722-736.
- Lusardi, A. (2019). Financial literacy and the need for financial education: evidence and implications. Swiss Journal of Economics and Statistics, 155(1), 1-8.
- Nazarov, D., Bayakhmetova, A., Bayakhmetova, L., & Bayakhmetova, L. (2022). A Model for Assessing the Causality of Factors in the Development of Voluntary Pension Insurance in the Republic of Kazakhstan. Mathematics, 10(9), 1415.
- Olgić Draženović, B., & Kusanović, T. (2016). Determinants of capital market in the new member EU countries. Economic Research-EkonomskaIstraživanja, 29(1), 758-769.
- Organization for Economic Co-operation and Development. (2019). Achieving better jobs, health, and opportunities for all.
- Pascual-Saez, M., Cantarero-Prieto, D., & Manso, J. R. P. (2020). Does population ageing affect savings in Europe? Journal of Policy Modeling, 42(2), 291-306.
- Pilipiec, P., Groot, W., & Pavlova, M. (2021). The effect of an increase of the retirement age on the health, well-being, and labor force participation of older workers: a systematic literature review. Journal of Population Ageing, 14, 271-315.
- Shariff, N. S. M., & Isah, N. A. M. (2019). An empirical study on the determinants of retirement savings attitude in Malaysia! Journal of Physics: Conference Series, 1366(1), 012110.
- Turkebayeva, K., Bekturganova, M., Sabden, O., Dauliyeva, G., & Kenzhegulova, G. (2022). Assessment of the relationship between inequality, income and economic growth in the regions of Kazakhstan. Problems and Perspectives in Management, 20(2), 511-521.
- United Nations Department of Economic and Social Affairs (2019). World population ageing 2019 highlights. New York: Population Division.
- Vivel-Búa, M., Rey-Ares, L., Lado-Sestayo, R., & Fernández-López, S. (2019). Financial planning for retirement: the role of income. International Journal of Bank Marketing, 37(6), 1419-1440.
- Willows, G. D. (2019). South African individual retirement savings: An analysis of the social factors. Risk Management and Insurance Review, 22(3), 303-328.
- Wolf, I., & Caridad y López del Río, L. (2021). Sustainability of funded pension schemes: A financial position perspective using options. Investment Management and Financial Innovations, 18(4).
- Ybrayev, Z., Orakbayev, Y., & Utarbayev, A. (2023). Yield Curves for Main Street: Housing and financial capital returns in a developing economy. Economics of Transition and Institutional Change, 1-18.
- Zaman, K. (2023). Navigating the Perils of a Banana Republic: Lessons from Pakistan’s Economic Crisis. Politica, 1(1)33-41.
- Zhandildin, M. (2015). Pension system reform in emerging countries: The case of Kazakhstan. Global Journal of Emerging Market Economies, 7(1), 65-88.