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Income Transfers to the Elderly in East Asia: Testing Asian Values
Huck-ju Kwon
June 1999
Paper No' CASE 027:
Full Paper (pdf)

Tags: public pensions; retirement policy; east asia

This article examines the role of family and the state in relation to the living standards of the elderly in East Asia. It tries to test whether familial arrangement according to Confucian ethics, which are still taken seriously in East Asia, secures the minimum standard of living for the elderly. This article, first, examines the social policy institutions for the elderly in Japan, South Korea and Taiwan. It argues that public policy in the region assumes the family as primarily responsible for elderly people's living standards. Secondly, this article analyses private and public income transfers to elderly households, based on micro-data sets for South Korea and Taiwan. It argues that private transfers do make important contributions to the income of the elderly households, particularly poorer households, while public transfers do not make any significant impact. This suggests that Confucian ethics are still working. Private transfers, however, fail to secure the minimum standards of living of the elderly. The elderly households are far more prone to poverty. The findings of this paper support the case for state action to protect the living standards of the elderly in East Asia.