1. The Crowding-out effect of mandatory labour market pensions schemes on private savings: evidence from Denmark Søren Arnberg Danish Economic Councils Mikkel Barslund Danish Economic Councils

2. Does mandatory pension savings crowd out private voluntary savings? Relevant for policy makers in two ways: -does mandatory savings increase total savings? -macroeconomic implications Motivation

3. Pension wealth and saving rates: King & Dicks-Mireaux (1982), Jappelli (1995), Alessie, Kapteyn & Klijn (1997), Gale (1998), Euwals (2000) Pension entitlements and private savings: Attanasio & Rohwedder (2003), Attanasio & Brugiavini (2003), Kim & Klump (2008) Context

4. Contribution Provide estimates of the offsetting effect of current mandatory savings on current voluntary savings Development of the Danish labour market pension system provides a direct route to assess the substitution…

5. Danish labour market pension schemes Part of collective agreements between unions and employers associations Mandatory for workers in an agreement area Some uncovered parts of the labour market

6. Contribution Rates for Danish Mandatory Labour Market Pensions

7. Differences in implementation Which parts of the salary are liable for pension contributions? Basic salary? Always Payments by results? For some groups

8. Observed contribution rates: school teachers 1998 2005

9. Contribution rates

10. CR for labour market pension

11. Pension savers in the group of 30 to 55 years old

12. Model voluntary savings mandatory labour market pension savings yearly earnings non-contractual wealth pension wealth age education interaction term

13. Estimated offset effects from the full sample.

14. Estimated offset effects from the sample of school and kindergarten teachers.

15. Separate offset effects estimated for private pension contributions and private non-pension saving.

16. Work to do… Liquidity constraints And more…