Pathways to Retirement in Taiwan: Do Ethnicity and Cohort Matter?

Abstract

Studies about retirement often neglect ethnic identity. This research utilized the “Taiwan Longitudinal Study in Aging” data from 1989 to 1996 when political and social changes in the country occurred to examine the influence of ethnicity (dominant Mainlanders versus Southern Min, Hakka, and various indigenous people) on Taiwanese men’s working status at age 60 and above. We asked three questions: (1) Are Mainlanders more likely to retire earlier than non-Mainlanders? (2) Does working in the public versus the private sector affect the age of retirement and does this differ by ethnicity? (3)What factors determine retirement ages of two cohorts? Using chi-square and t-tests, results of a comparison of two cohorts (n = 1254 and n = 526 for the 1989 and 1996 cohorts, respectively) showed that being a Mainlander, being unmarried, older age, self-reported poor health, and functional limitation were associated with a higher likelihood of earlier retirement. In logistic regression models, public sector work mediated and moderated the effect of ethnicity on the likelihood of earlier retirement only in the older cohort, where Mainlander public sector workers had the greatest likelihood of earlier retirement, indicating that the incentive structure of public pensions contributes to earlier retirement. The results are consistent with cumulative advantage theory. To delay the retirement age for public sector workers, policymakers could reduce public pension incentives.