Date of Completion


Embargo Period



early retirement, pension system, demographic change, saving rate, current account

Major Advisor

Francis Ahking

Associate Advisor

Kai (Jackie) Zhao

Associate Advisor

Kanda Naknoi

Field of Study



Doctor of Philosophy

Open Access

Open Access


My dissertation consists of three chapters, which study the relationship between early retirement, demographic structure, and savings, international capital flows in developing countries, especially in China. The first chapter studies the role of early retirement and pension system as drivers of China's persistent high savings. The main findings are that the early retirement effect contributes to the majority of the growth and fluctuation in the saving rate while both early retirement effect and wealth substitution effect have a positive impact on the saving rate. The second chapter, accounting for the facts that the global current account balance must be equal to zero, re-examines the impact of demographic change on the current account balance. The main finding of this paper is that the young dependency ratio has a robust and significant negative impact on the current account but the old dependency ratio has an ambiguous and insignificant impact on the current account under the general equilibrium condition. The last chapter examines studies the role of early retirement and pension system reform as drivers of China's persistent high savings and current account surplus with the aid of an opened-economy model. The results show that, the dominant early retirement effect coupled with the wealth substitution effect can increase the household’s savings. The current account surplus is due to the high savings and the domestic firms have financial borrowing friction to access domestic investment. The earlier and earlier actual retirement age finally results in the growing saving rates and current account surplus under the restriction of domestic investment.