Differences in Public Pension Entitlements within Couples – Analyses Based on SHARE-RV

Abstract

Within the three-pillar German pension system, the German Pension Insurance remains the most important source of old-age income. From a gender comparative perspective, existing literature shows the inequality between men and women regarding income and wealth in general. Wealth includes pension wealth quantified as entitlements within the pension system. Although different compensatory mechanisms have been implemented within the public pension system (e.g., entitlements for child-raising periods, pension splitting after divorce), women on average accumulate fewer pension entitlements in the German Pension Insurance than men and thus receive lower pension payments. However, little is known about the gender-specific distribution of public pension entitlements within couples, which is becoming more relevant with increasing individualization of financial resources in partnerships. The linked data set SHARE-RV provides valuable research data by directly linking the German sample of the Survey of Health, Ageing and Retirement in Europe (SHARE) to selected administrative data from the German Pension Insurance (RV). It offers exact data from the pension accounts of the SHARE respondents as well as important contextual and household information. Using SHARE-RV data, I contribute to the question of how pension entitlements are distributed within cohabiting couples aged 50 years and older and which factors influence this distribution. The focus of the analysis is on the influence of different socio-demographic factors on the gender-specific difference in public pension entitlements. The goal is to explore the effects of age, marital status, education, having children, and place of residence on the entitlement gap between partners. Results show that the difference in the educational level between partners influences the entitlement gap in both directions. Married couples and couples with children show a larger gap in entitlements than unmarried and childless couples. Furthermore, the entitlement gap is larger for couples living in West Germany than for couples living in East Germany. These results are in line with previous findings on gender inequalities in income and pensions and contribute to a better understanding of the specific perspective on pension entitlements within couples.