Jaco Zuijderduijn, Associate Professor of Department of Economic History at Lund University, presented a report on pension arrangements and way of old-age care in medieval and pre-modern Europe at Chen Daisun Theoretical Economics Lecture and Economic History Lecture at Tsinghua University, with the theme of “What did retirement cost back then? Old age pensions well before the welfare state.”. This is the subject he is currently studying.
Before Europe entered industrialization, the state did not provide pension insurance and socialized pension arrangements, and civilians needed to plan their own pension arrangements and old-age care issues. The first half part of the lecture is about the calculation of old-age care costs. Professor Jaco showed how many days’ wages would have to be saved in London, Antwerp and Vienna between 1259-1886 in order to retire in a decent way. In general, the deposits required by the old-age care were on the rise in the long term, but this trend varied across regions. Professor Jaco used the long-term decline in interest rates to explain the long-term rise in old-age care costs. In the latter part of the lecture, Professor Jaco introduced three more common pension arrangements in Europe of the time. The first arrangement was the pensions provided by bodies such as guilds. This is like a financial product. Investors invest in this financial product when they are young, and extract annuity when they are old. The second arrangement was endowment agreement. Some people may sign endowment agreements with their children before transferring their property to them. At that time, 41% of the land transactions were accompanied by endowment agreements. The third arrangement was private old-age care institutions. Older persons entered into agreements with old-age care institutions to provide shelter, diet and care upon payment of certain fees. These contractual pension arrangements were common in medieval and pre-modern Europe, although they supplemented “informal” pension systems such as family care and poverty relief. According to Jaco’s information, about 20% of Europeans would adopt these contractual and “formal” pension arrangements.
The lecture was chaired by Professor Long Denggao and commented by Dr. Zhao Liang of Lund University. In addition, Professor Zhu Ling, Member of Academic Divisions (AD) of Institute of Economics, Chinese Academy of Social Sciences, Professor Chen Zhiwu, University of Hong Kong, Professor Zhou Jianbo, Peking University, and Professor Zhang Weihong of Ghent University, participated in and discussed online.
(Contributed by Dr. Zhao Liang of Lund University)
