The Economic Effect of the Basic Pension and National Health Insurance: A Social Accounting Matrix Approach

The Economic Effect of the Basic Pension and National Health Insurance: A Social Accounting Matrix Approach

Jongwook Won ; Insu Chang

사회계정행렬 ; 기초연금
Publication Year
Korea Institute for Health and Social Affairs
It is critical to keep track of, and analyze the income protection effect of the Basic Pension and the economic effect of increasing Basic Pension benefits in order to increase the fiscal sustainability of the basic pension system and alleviate old-age poverty.
Also, according to the Social Security Fiscal Projections of March 2015, NHI spending is
expected to grow rapidly to reach between KRW 694 trillion and KRW 1,099 trillion by 2050. Such rapid growth of NHI spending calls for analyses of the NHI policy effects and measures to ensure their fiscal sustainability.
So, we apply the SAM (Social Accounting Matrix) in this study to analyze the micro- and macro-level effects of the BP and NHI on the rest of the national economy. Our analysis provides basic information with which policymakers can estimate the impact of the Basic Pension and National Health Insurance policy.
Table Of Contents
Ⅰ. Introduction 1
Ⅱ. Methodology of Analysis 7
1. Social Accounting Matrix (SAM) 9
2. Creating a macro SAM 10
3. Creating bridge matrices for micro SAMs 11
4. Creating micro SAMs 16
5. Creating multiplier matrices 18
Ⅲ. Basic Pension (BP) 21
1. Underlying assumptions: fiscal streamlining and tax
financing 23
2. Economic ripple effects of fiscal streamlining 27
3. Economic ripple effects of tax financing 28
4. Income redistribution effect of the BP 32
5. Conclusion 33
Ⅳ. National Health Insurance (NHI) 35
1. Scenarios for analysis 37
2. NHI expenditure and revenue: current status and outlook 38
3. Creating a SAM for analysis 39
4. Analysis results 42
5. Conclusion 56
References 57
Local ID
Policy Report 2016-01
KIHASA Research
Subject Classification
Health care > Health care safety net
Income protection > Public pension
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