The reform of retirement pension system

摘要

This paper introduces some mathematical models which are used to forecast the trend of retirement pension. According to simplified and reasonable assumptions about Chinese economy development and wage growth situation in the future, we establish the prediction models on average annual wage and shortage. By way of illustration, we find the substitution rate in each case. Finally, we also find the shortage of pension fund, and how old the worker was when achieving a balance between the sum of contribution and the sum of retirement pension. Observation can be found from the illustration that the substitution rate is lower than the target substitution rate, and the payment years for contribution is longer, the substitution rate is greater, on the contrary, it will be difficult to achieve a balance between the sum of contribution and the sum of retirement pension.