August 2018

06Aug

A Risk Too Far The Case Against Collective Defined Contribution Pensions

By Michael Johnson Royal Mail has committed to offering its workers a Collective Defined Contribution (CDC) pension scheme, designed to split the difference between existing Defined Contribution and Defined Benefit schemes. The CDC idea is winning increasing support. But it is risky, untested and undermines the personal pensions freedoms introduced in 2015 The system risks creating irreversible intergenerational injustice by overpaying pensioners at the expense of current and future employees. It is also unclear whether what is promised to workers is actually deliverable. Where...

August 6, 2018
Articles, Pension design, System Sustainability, , , ,
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July 2018

30Jul

The Winning Combination of Surviving Together: Poor and Their Resilience Built Through Relationships

By Arun Keshav (Amity University, Rajasthan) Social capital happens to be one of the most important assets that poor possess. It is this safety net on which they fall upon at time of crisis and also draw security to reduce their vulnerabilities to several risks but what strength lies behind this social capital? Why poor invest so much in their social relations? In this article the author tries to understand what lies behind these and the winning combination of surviving...

July 30, 2018
Articles, Labor Market, , , , ,
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30Jul

Well-Appreciated but (Too) Difficult Pensions Choices? Insights from the Swedish Premium Pension System

By Monika Böhnke (Maastricht University - Department of Marketing), Elisabeth Brüggen (Maastricht University) & Thomas Post (Maastricht University - School of Business and Economics - Department of Finance; Netspar) We analyze experiences of savers in a DC pension scheme from Sweden – a country that was among the first to launch choice-based funded individual pension accounts. Based on a survey among 2,646 savers, we find that the average saver feels unknowledgeable about the scheme and experiences choice overload. Pension savers...

July 30, 2018
Articles, Labor Market, Pension design, Slider-Left
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25Jul

The Role Of The Chilean CCR In Private Equity

The Chilean pension fund system has breached in 2018 the 200bn threshold. Its pension fund system – Administradoras de Fondos de Pensiones – traditionally already very open to investment overseas, has now the potential to increase exponentially the exposure to overseas alternative investments. A recent reform affecting the pension system allows in fact Chilean pension funds now to directly invest as well as co-invest in foreign private equity funds. The Chilean pension regulator - Superintendencia de Pensiones - issued in November 2017 a regulation...

July 25, 2018
Articles, Investing, Regulation, , ,
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23Jul

Central States Pension Fund: Department of Labor Activities Under the Consent Decree and Federal Law

By Charles A. Jeszeck (Government Accountability Office (GAO)), David Lehrer (Government Accountability Office (GAO)), Margaret Weber, Laurel E. Beedon, Charles J Ford, Jessica Moscovitch, Layla Moughari, Joseph Silvestri, Anjali Tekchandani, Frank Todisco (Independent), Adam Wendel (Government Accountability Office (GAO)) The Central States, Southeast and Southwest Areas Pension Fund (CSPF) was established in 1955 to provide pension benefits to trucking industry workers and is one of the largest multiemployer plans. According to its regulatory filings, CSPF had less than half the...

July 23, 2018
Articles, Labor Market, Regulation, , ,
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23Jul

The Retirement Belief Model: Understanding the Search for Pension Information

By Wiebke Eberhardt (Maastricht University), Elisabeth Brüggen (Maastricht University), Thomas Post (Maastricht University) & Chantal Hoet (Aegon) Many individuals avoid information relevant for retirement planning. This behavior is worrying as pension systems shift risks and responsibilities to individuals. Individuals who avoid pension information fail to discover whether they save too little for retirement, negatively affecting their long-run financial well-being. We generate knowledge about the factors that stimulate or hinder the search for pension information. Using an interdisciplinary lens, we develop...

July 23, 2018
Articles, Pension design, , ,
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16Jul

The Mommy Effect: Do Women Anticipate the Employment Effects of Motherhood?

By Ilyana Kuziemko, Jessica Pan, Jenny Shen, Ebonya Washington After decades of convergence, the gender gap in employment outcomes has recently plateaued in many rich countries, despite the fact that women have increased their investment in human capital over this period. We propose a hypothesis to reconcile these two trends: that when they are making key human capital decisions, women in modern cohorts underestimate the impact of motherhood on their future labor supply. Using an event-study framework, we show substantial...

July 16, 2018
Articles, Labor Market, Pension design, , , ,
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16Jul

Immigration and Redistribution

By Alberto Alesina, Armando Miano, Stefanie Stantcheva We design and conduct large-scale surveys and experiments in six countries to investigate how natives' perceptions of immigrants influence their preferences for redistribution. We find strikingly large biases in natives' perceptions of the number and characteristics of immigrants: in all countries, respondents greatly overestimate the total number of immigrants, think immigrants are culturally and religiously more distant from them, and are economically weaker – less educated, more unemployed, poorer, and more reliant on...

July 16, 2018
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16Jul

The Extent and Nature of State and Local Government Pension Problems and a Solution

By Ross Marchand (Taxpayers Protection Alliance) & Mark Warshawsky (Government of the United States of America - Social Security Administration) Some states and municipalities are in difficult financial straits. Many more have severely underfunded defined benefit pension plans for their past and current employees. At the intersection of these two sets, it is likely that the pension plans are not sustainable and cuts are inevitable, including to the benefits of current retirees. But in many of these states and municipalities,...

July 16, 2018
Articles, Pension design, System Sustainability, , ,
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09Jul

Financial stability implications of a prolonged period of low interest rates

From  Committee on the Global Financial System The decade following the Great Financial Crisis (GFC) has been marked by historically low interest rates. An environment characterised by "low-for-long" interest rates may dampen the profitability and strength of financial firms and thus become a source of vulnerability for the financial system. In addition, low rates could change firms' incentives to take risks, which could engender additional financial sector vulnerabilities. This report identifies and provides evidence for the channels through which a "low-for-long"...

July 9, 2018
Articles, System Sustainability, , ,
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