Decisões de participação laboral e aposentadoria na América Latina: O papel dos incentivos dos pilares contributivos dos sistemas de previdência na extensão da vida ativa nos casos de Paraguai, Chile e Uruguai

Abstract

Over the past decades, population aging in Latin America has advanced in parallel with the maturation of pension systems. In several Latin American countries, the sustainability challenges of these systems—stemming from aging—coexist with coverage inequalities typical of expansion phases. The institutional response has involved a shift from intergenerational redistribution pension systems (defined benefits) to those based on intragenerational transfers or defined contributions. The latter type of systems has an incentive structure that encourages people to participate and to delay claiming. This study examines how contributory pension schemes influence the participation and benefit-claiming decisions of older people in three Latin American countries (Paraguay, Chile, and Uruguay). Its objectives are: a) To describe the length of working life for people aged 50 and above. We calculate average ages and life expectancies in terms of activity and pension using the Singulate Mean Age at First Marriage (SMAFM) and Sullivan’s method. b) To examine the endogenous relationship between participation and contributory pension claiming, using univariate and bivariate probit regression models. It is suggested that defined benefit schemes promote simultaneous participation and claiming decisions, while defined contribution systems incentivize the separation of these choices. c) To analyze the effects of pension systems on shaping the profiles of older adults covered by pension, active, and vulnerable. Marginal effects of the joint probabilities from the bivariate probit are estimated. The sources used include: a) The harmonized database of longitudinal surveys on social protection (ELPS), and b) Sex-disaggregated life tables for each country, provided by the Population Division for the 2010–2015 period.

The study concludes that: a) Working life is extended, even with comparatively high mortality at older ages. Among men, active life expectancy exceeds 40 years, and their withdrawal from the labor force occurs near retirement age, while women’s working life spans between 27 and 43 years, with retirement occurring earlier. Between 1/4 and 3/4 of active life expectancy is allocated to the informal labor market, while 3 to 4 years are spent in unemployment. b) Receiving pension benefits reduces labor participation in all three countries and among both sexes, with a sharp decline at eligibility ages. Participation and claiming decisions occur simultaneously among older persons of both sexes in the three countries. Factors that positively affect claiming have a negative effect on participation, which changes their direction and significance once endogeneity is considered. c) There is a relationship between profiles composition and the type of pension scheme. The profile that combines activity and non-claiming is not necessarily associated with vulnerability, especially due to the role of education. In countries with defined contribution pillars—such as Chile and Uruguay—a higher educational level increases the probability of men participating without claiming, while in defined benefit systems, it reduces the chances. This pattern does not hold for women. Among men, health status discourages this profile. Remaining active and receiving a pension is associated with younger age, higher education, longer work histories, and at least a minimum level of contribution density. The vulnerable profile is more prevalent among women and linked to shorter contribution histories and family dependence. The composition (measured by education, work experience, health, and contribution density) is less heterogeneous under defined contribution systems, but only among men.