December 2021
17Dec

Spending in the Shadow: The Impact of Unfunded Pensions on Public Services and Public Employees

By Manita Rao The shadow of unfunded public pensions has raised concerns on its consequences for public services and public employees. Some argue that pension liabilities increase the cost of government by crowding out public services. Others suggest that unfunded pensions are more likely to affect public employees and have limited implications for public services. This article empirically examines the extent to which the impact of unfunded pensions is mitigated or has spillover effects on public services and public employees....

December 17, 2021
Articles, Public Pensions,
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11Dec

Reforms of an Early Retirement Pathway in Germany and Their Labor Market Effects

By Regina T. Riphahn & Rebecca Schrader We investigate the unemployment pathway to retirement in Germany and study the causal effects of two early retirement reforms. Reform 1 (NRA) increased normal retirement age stepwise from 60 to 65. Simultaneously, it became possible to use early retirement with benefit discounts. Reform 2 (ERA) increased the age of early retirement stepwise from 60 to 63. We investigate behavioral responses to the reforms using administrative data and difference-indifferences strategies. We find strong and...

December 11, 2021
Articles, Pension design, , ,
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11Dec

Asset Allocation: Glide Path Design for Target Date Retirement Funds

By Thomas Present & Sharon Persyn In this thesis, we discuss and compare target date retirement fund strategies that have been used in recent literature. These strategies include the 100% equity, glide path, maximum drawdown, risk budget and target return strategy. We conduct sensitivity analyses in order to obtain optimal parameters for the different strategies. We first compare the strategies with rebalancing between two asset classes: equity (Russell 1000) as the risky asset and bonds (10Y US government bonds) as...

December 11, 2021
Articles, Investment, ,
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11Dec

Artificial Intelligence and Big Data in the Age of COVID-19

By Francisco J. Bariffi & Julia M. Puaschunder The view that the COVID19 pandemic has set in motion profound changes in our modern societies is practically unanimous. The global effort to contain, cure, and eradicate COVID19 has been greatly benefited by the use, development and/or adaptation of technological tools for mass surveillance based on artificial intelligence and robotics systems. The management of the COVID19 pandemic yet has also revealed many shortcomings generated from the need to make decisions “in extremis”....

December 11, 2021
Articles, System Sustainability, , ,
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03Dec

Elderly Poverty and its Measurement

By Yoko Niimi & Charles Yuji Horioka This paper examines various aspects of elderly poverty and its measurement. It first discusses some of the most important issues relating to measuring elderly poverty. It then reviews recent trends in elderly poverty, which show considerable heterogeneity in the extent of elderly poverty even among developed countries. Such cross-country differences are due at least partly to differences in the generosity of public old-age pensions and other social safety nets for the elderly. Empirical...

December 3, 2021
Aging, Articles, , , ,
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03Dec

Old-Age Pensions and Female Labour Supply in India

By Vidhya of Unnikrishnan & Kunal Sen Whether cash transfers have unintended behavioural effects on the recipient household’s labour supply is of considerable policy interest. We examine the impact’ of the Indira Gandhi National Old-Age Pension Scheme (IGNOAPS) on prime-age women’s labour supply decisions in India, where female labour force participation continues to decline over time. We use propensity score matching (PSM) to make households with IGNOAPS recipients comparable with program non-recipients. Further, we use individual fixed effects (FE) to...

December 3, 2021
Articles, Labor Market, , ,
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03Dec

EU Pension Taxation: Removing Another Brick in the Wall?

By Hans van Meerten & Philip Bennett On 11 November 2021, the Court of Justice (Third Chamber) decided the case of MH and ILA (Pension rights in case of bankruptcy)(C-168/20). There was no Opinion by the Advocate-General. Although usually a sign thatthe case was not that important,there are exceptions.This seems one o them. This stems from a reference from the High Court of Justice of England and Wales (‘the High Court’) to the Court of Justice. The referred question related to...

December 3, 2021
Articles, Pension design, , ,
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November 2021
26Nov

An Overview of Retirement Income Planning

By Wade D. Pfau Retirement income planning has emerged as a distinct field within financial planning with the realization that risks change dramatically in retirement. The combination of longevity risk, increasing market risk triggered by taking distributions from assets, and spending shocks create new challenges. Wealth management has traditionally focused on accumulating assets without applying further thought to these differences happening after retirement. Retirees experience reduced capacity to bear financial market risk once they have retired. This calls for different...

November 26, 2021
Articles, Pension design, ,
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26Nov

Population Aging and Worklife Duration: Myths and Realities in the Canadian Context

By Gilbert M., Yves Carrière & Marcel Mérette Population ageing is raising concerns about labour shortage and public finance sustainability, on the assumption that increased age-based dependency ratio is a synonym of shrinking working lifespan for financing expanding lifespan consumption. However, such assumptions usually omit an appropriate account of changing labour force participation and hours worked (behavioural components) which could be playing toward or against the tides of populating ageing (structural components). This paper estimates worklife duration in Canada between...

November 26, 2021
Aging, Articles, Labor Market, ,
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26Nov

Preventing Reforming Unequally

By Axel H. Boersch-Supan, Klaus Härtl, Duarte Nuno Leite & Alexander Ludwig Population aging has forced policy makers in most developed countries to reform pension systems with the aim to maintain or re-establish financial sustainability. This usually involves cost-cutting measures like later pension eligibility ages and lower replacement rates. Such reforms face harsh trade-offs with the objective of providing adequate pensions. Social welfare and inequality have emerged as crucial concerns about recent pension reforms, stressing that the lack of 'social...

November 26, 2021
Aging, Articles, Regulation, , ,
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