The Chilean pension system : gender inequalities in contribution densities

textIn 1981, Chile established a defined contribution pension system, replacing the traditional pay-as-you-go system with defined benefits. The new model based on individual capitalization accounts, has generated different patterns of contributions to the individual accounts, mostly associated to labor market trajectories or unemployment. This report focuses on gender disparities in the Chilean pension system by analyzing the determinants of contribution densities for women and men. It explores how labor market trajectories, indicators of employment stability, and socioeconomic characteristics of the household of origin, affect contribution densities in the pension system. The main results confirm the existence of indirect gender inequalities that originate in the labor market and are then transmitted to the pension system. Furthermore, the results clearly support the existence of traditional gender roles with respect to work and family, which ultimately also have an effect on the pension system, through labor market trajectories. Finally, the report finds that mothers' education has an effect on the next generation's contribution densities, the relationship being a transmission of advantages.Public Affair