Population aging causes financial imbalance of the pay-as-you-go public pension (social security) program. To remedy this problem but also ensure the adequacy of retirement saving for employees, many countries complement or substitute for public pensions by regulating private pensions.
This paper is the first to utilize national pension policy change as a natural experiment to identify the impact of employer pensions on household voluntary savings. Specifically, I evaluate the response of household saving to mandatory employer-provided pension reform in Taiwan, which mandates that all private sector employers contribute at least 6% of the wage to employees’ individual pension accounts monthly since 2005