February 2017

04Feb

Understanding the dynamics of labor income inequality in Latin America

By Carlos Rodriguez Castelan, Luis Felipe Lopez-Calva, Nora Lustig & Daniel Valderrama Since the early 2000s, after a long period of wide and persistent gaps, Latin America has experienced a steady decline in income inequality. This paper presents evidence of a trend reversal in labor income inequality, which is considered the main factor behind such a decline in income inequality across the region. The analysis shows that, while labor income inequality increased during the 1990s, with heterogeneous experiences across countries,...

February 4, 2017
Articles, Labor Market
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04Feb

Enforcement capacity and the impact of labor regulation : evidence from the Russian Federation

By Álvaro Gonzalez, Siddharth Sharma & Hari Subhash The impact of business regulations on firms could depend on how the regulations are enforced in practice. Exploiting variation in enforcement capacity across the Russian Federation's administrative regions, this paper examines whether the enforcement of restrictive regulations on hiring and firing workers affects how firms adjust employment during industry upswings and downswings. The analysis finds that the extent to which firms adjust employment upward during industry upswings and downward during downswings is...

February 4, 2017
Articles, Labor Market, Regulation, Supervision,
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04Feb

World Bank Pension Reforms and Development Patterns in the World System and in the Wider Europe: A 109 Country Investigation Based on 33 Indicators of Economic Growth, and Human, Social and Ecological Well-Being, and a European Regional Case Study

By Arno Tausch On the first anniversary of the death of Nobel Laureate Professor Franco Modigliani, the Luxembourg Institute for European and International Studies (LIEIS) organised a conference on 'Reforming European Pension Systems' on 24 and 25 September 2004 in Schengen. Initially, the intention was to hold this conference in the presence of Professor Modigliani who had written a comprehensive paper for the LIEIS. However, due to ill health, such a meeting had to be postponed repeatedly. A third date was...

February 4, 2017
Adequacy, Articles, Regulation, Savings, , ,
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04Feb

Strategic and Tactical Allocation to Commodities for Retirement Savings Schemes

By Theo Nijman & Adrianus Petrus Swinkels We examine whether the variance risk of investment portfolios of pension schemes investing in traditional asset classes can be reduced by extending the set of traditional investment opportunities with commodities. We investigate the economic and statistical significance of shifts in the strategic (three year), myopic (quarterly), and tactical (quarterly rebalancing) mean-variance frontier for pension schemes with a fixed liability portfolio. We find substantial differences in optimal strategic allocations for pension schemes with nominal...

February 4, 2017
Articles, Investing, Savings,
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04Feb

Employee Participation, Corporate Governance and the Firm: A Transatlantic View Focused on Occupational Pensions and Co-Determination

By Markus Roth Corporate governance and the theory of the firm are discussed primarily from the shareholders’ perspective. This point of view neglects the tremendous effects of private pensions and of co-determination as well as interdependencies between co-determination, pensions and corporate governance. Since in the private pension world the firm serves as an investment tool, the focus should be shifted from short-term interests to concepts maximising long-term shareholder value. In this context, also moderate forms of co-determination might serve as...

February 4, 2017
Articles, Corporate Governance, Labor Market,
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04Feb

Public Pensions and the Promise of Shareholder Activism for the Next Frontier of Corporate Governance: Sustainable Economic Development

By David Hess In this paper, I bring together recent developments in shareholder activism, responsible investing, and "new governance" regulation, to consider the role of public pension funds as a surrogate regulator for corporate sustainable development. Although a handful of public pensions are active in issues related to sustainability, this paper provides evidence showing that the vast majority are not. These conclusions, and explanations for why this is the case, are based in part on a survey of public pension...

February 4, 2017
Articles, Corporate Governance, Regulation,
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04Feb

The German Social Market in the World of Global Finance: Pension Investment Management and the Limits of Consensual Decision Making

By Gordon L. Clark, Daniel Mansfield & Adam Tickell In a previous paper we emphasised the changing national and international accounting standards used to measure net pension liability. Beginning with the implications of this analysis for the financing of German employer-sponsored pensions, in this paper we focus upon the internal management of corporate pension assets and liabilities. Two issues drive the analysis. One has to do with the emerging coalescence of interests joining corporate management and shareholders in relation to the management...

February 4, 2017
Articles, Corporate Governance, Investing,
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04Feb

The Rise of Pension Fund Capitalism in Europe: An Unseen Revolution?

By Adam Dixon In recent years European countries have begun to reform their pension systems favouring funded to pay-as-you-go (PAYG) social security systems and supporting the creation of more 2nd and 3rd pillar funded retirement schemes. Though funded pensions remain small in most European countries, they are growing significantly and may limit the persistence of strong 'varieties of capitalism' by providing an endogenous source of change to economic organisation and corporate governance. To explore this scenario this article examines recent...

February 4, 2017
Articles, Corporate Governance, Investing, System Sustainability, ,
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04Feb

Do a Firm's Equity Returns Reflect the Risk of Its Pension Plan?

By Zvi Bodie, Robert C. Merton & Li Jin This paper examines the empirical question of whether systematic equity risk of US firms as measured by beta from the capital asset pricing model reflects the risk of their pension plans. There are a number of reasons to suspect that it might not. Chief among them is the opaque set of accounting rules used to report pension assets, liabilities, and expenses. Pension plan assets and liabilities are off-balance sheet and are often...

February 4, 2017
Articles, Corporate Governance, Investing,
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04Feb

Do a Firm’s Equity Returns Reflect the Risk of Its Pension Plan?

By Zvi Bodie, Robert C. Merton & Li Jin This paper examines the empirical question of whether systematic equity risk of US firms as measured by beta from the capital asset pricing model reflects the risk of their pension plans. There are a number of reasons to suspect that it might not. Chief among them is the opaque set of accounting rules used to report pension assets, liabilities, and expenses. Pension plan assets and liabilities are off-balance sheet and are often...

February 4, 2017
Articles, Corporate Governance, Investing,
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