April 2018

23Apr

Do People Really Want Freedom of Choice? Assessing Preferences of Pension Fund Participants

Reforms in private pension plans across the world are opening up more options for pension participants to make choices to suit their preferences. Freedom of choice is however not a unidimensional concept as it is commonly perceived by policy makers. People can value both the freedom to choose as well as the freedom not to choose This observation can have far-reaching implications for pension policy design. By using a unique panel survey among Dutch employees we are able to...

April 23, 2018
Articles, Labor Market, Pension design, Savings
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23Apr

Freedom and choice in pensions

The government’s long-term economic plan is providing the foundations for the UK’s future economic security. A key part of this is to foster a new culture of saving. Saving must be flexible and attractive in order to encourage people to take greater responsibility for their financial future. And people need to have access to the best advice. Nowhere is this more important than in saving for a pension and planning for retirement. When this Government took office the pensions system...

April 23, 2018
Management, Pension design
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23Apr

Defined Contribution Pensions: Plan Rules, Participant Choices, and the Path of Least Resistance

By James J. Choi, David Laibson, Brigitte C. Madrian & Andrew Metrick Over the last 20 years, defined-contribution pension plans have gradually replaced defined benefit pension plans as the primary privately sponsored vehicle to provide retirement income. At year-end 2000, employers sponsored over 325,000 401(k) plans with more than 42 million active participants and $1.8 trillion in assets.1 The growth of 401(k)-type savings plans and the associated displacement of defined benefit plans have generated new concerns about the adequacy of employee...

April 23, 2018
Pension design, ,
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23Apr

“Rethinking Pension Reform: Ten Myths About Social Security Systems”

By Peter R. Orszag & Joseph E. Stiglitz Averting the Old Age Crisis, the World Bank's path-breaking publication on pensions, trenchantly notes that "myths abound in discussions of old age security."2 This paper examines ten such myths in a deliberately provocative manner. Our hope is not only to spur debate during this "New Ideas About Old Age Security" conference, but more broadly to ensure that policy-makers understand the complexity of pension reform. It is testimony to the power of Averting the Old...

April 23, 2018
Pension design,
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23Apr

Employee Saving and Investment Decisions in Defined Contribution Pension Plans: Survey Evidence from the UK

By Alistair Byrne (University of Edinburgh) This paper uses data from a survey of the members of a UK defined contribution pension plan to explore the attitudes and knowledge of employees faced with pension saving and investment decisions. The results are consistent with behavioural economics in that many employees show limited interest in their pension arrangements. Not all members have received advice about their pension, but those who have are more likely to have calculated their savings needs, to have...

April 23, 2018
Pension design,
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23Apr

Organizing Old Age Pensions for India's Informal Workers: A Case Study of a Sector-Driven Approach

By M.R. Narayana (University of Mysore) About 88 percent of India’s total labor force is composed of informal (officially labeled “unorganized”) workers. As many as 388 million such workers lack old age income security by way of a pension system. The Atal Pension Yojana (APY) is the latest contributory, national-level old age pension scheme for unorganized workers, with an entry age of 18–40 years. In other words, all current unorganized workers above the age of 40 are excluded. How could...

April 23, 2018
Aging, Articles, Labor Market, Pension design, , ,
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23Apr

Organizing Old Age Pensions for India’s Informal Workers: A Case Study of a Sector-Driven Approach

By M.R. Narayana (University of Mysore) About 88 percent of India’s total labor force is composed of informal (officially labeled “unorganized”) workers. As many as 388 million such workers lack old age income security by way of a pension system. The Atal Pension Yojana (APY) is the latest contributory, national-level old age pension scheme for unorganized workers, with an entry age of 18–40 years. In other words, all current unorganized workers above the age of 40 are excluded. How could...

April 23, 2018
Aging, Articles, Labor Market, Pension design, , ,
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23Apr

Retirement Drawdown Defaults: The Role of Implied Endorsement

By Jennifer Alonso-García (University of New South Wales (UNSW) - ARC Centre of Excellence in Population Ageing Research (CEPAR)), Hazel Bateman (University of New South Wales (UNSW) - School of Actuarial Studies, Centre for Pensions and Superannuation), Johan Bonekamp (Tilburg University - Department of Econometrics & Operations Research), Ralph Stevens (CPB Netherlands Bureau of Economic Policy Analysis; CEPAR) This paper explores whether implied endorsement can serve as an explanation for the stickiness of retirement drawdown defaults. Using an experimental survey...

April 23, 2018
Articles, Pension design, Savings, ,
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09Apr

Best Interests in the Long Term: Fiduciary Duties and ESG Integration

By Susan N. Gary (University of Oregon - School of Law) Two persistent misconceptions continue to affect the way fiduciaries think about sustainable investing: (1) fiduciary duties block a fiduciary investor from considering environmental and social factors and (2) if a fiduciary investor engages in sustainable or responsible investing, the portfolio will suffer financially. An examination of socially responsible investing, ESG integration (an investment process that involves consideration of material environmental, social and governance (ESG) factors together with traditional financial...

April 9, 2018
Articles, Pension design, ,
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