Private wealth and retirement in France

This document relies on the 2009-2010 French wealth survey (enquête Patrimoine) and the dynamic microsimulation model Destinie to reevaluate substitution effects between pension entitlements and private savings for French Households. Savings behavior is modeled after Gale (1998). Our results highlight the existence of a substitution effect between household savings and their pension. The magnitude of these effects is sensitive to the discount rate of agents. An increase in public pensions leads to a decrease in complementary pension products and real estate investment. It is this latter effect that dominates.