April 2017

03Apr

Financial History: Lessons of the Past for Reformers of the Present

By Gerard Caprio Jr. (Williams College) & Dimitri Vittas (World Bank) The environment in which financial institutions operate has changed greatly, but the history of financial development offers important lessons for today. Among the lessons financial history offers: Macroeconomic stability - low inflation and sound public finance - is important for creating the right incentives for banks and for facilitating the development of securities markets. High inflation and large fiscal deficits distort economic behavior in favor of short-term speculative projects and...

April 3, 2017
Articles, Investing, Regulation, Savings, , ,
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March 2017

26Mar

Redistribution Effect and Pension Choice: Theory and Evidence

By Hulai Zhang (Peking University) This paper mainly focuses on two issues, the factors influencing pension choice and the redistribution effect of the pension system in China. Our model studies the trade-offs of relative financial benefits and risks provided by various plans, as well as the accessibility to specific pension plans and accessibility to information on pensions. The features examined include individual features such as hukou, gender and education, family features like marital status and work features like job types....

March 26, 2017
Articles, Labor Market, Pension design, Regulation, , , ,
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26Mar

How Productivity Can Affect Pension Systems: The Case of Japan and Malaysia

By Mario Arturo Ruiz Estrada (University of Malaya) This research paper proposes a group of new indicators in the analysis of pension programs performance. Section one presents a new model of analysis to evaluate the pension systems. This new model, “The Pensions Systems Performance Evaluation Model (PSPE-Model)” is intended to offer policy-makers and researchers an additional analytical tool to study the impact of productivity on the pension systems performance from a new perspective. The PSPE-Model can be applied to the...

March 26, 2017
Articles, Corporate Governance, , ,
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23Mar

Beyond the Privatisation and Re-Nationalisation of the Argentine Pension System: Coverage, Fragmentation, and Sustainability

By Fabio Bertranou & Luis Casanova (International Labour Organization);  Oscar Cetrángolo & Carlos Grushka (University of Buenos Aires) In the last decades, the pension system in Argentina has experienced important changes that included the introduction of an individual account defined-contribution component (or individual capitalisation) in 1994 and its subsequent reversal to a defined benefit pay-as-you-go pension scheme in 2008. After the 2001 crisis, the favourable fiscal position allowed the implementation of policies that reversed the decline in pension coverage to unprecedented...

March 23, 2017
Articles, Corporate Governance, Regulation, System Sustainability, , , ,
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13Mar

Is There a Positive Incentive Effect from Privatizing Social Security: Evidence from Latin America

By Truman G. Packard (World Bank) There is increasing concern among policymakers that social security reforms that involve a transition to individual retirement savings accounts may exclude certain groups of workers from coverage against the risk of poverty in old age. While most public pay-as-you-go systems pool the risk of interrupted careers and periods of low earnings over the covered population, the reformed systems shift the burden of these risks to the individual. Adequate coverage under a system of individual...

March 13, 2017
Articles, Labor Market, Regulation, , ,
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08Mar

Embedded Flaws of the Bulgarian Pension Funds or the Code Against the Insured

The Bulgarian pay-as-you-go publicly managed pension system is complemented by default and voluntary defined contribution pension funds, managed privately. The regulatory regime of the private pension funds is such that turns them into: unsuitable, uncompetitive and ineffective pension products. Privately managed pension funds are unsuitable, because they are not aligned with the investment horizon and the risk tolerance of individual investors. They are uncompetitive since their track record is of delivering below market returns for above market fees and charges....

March 8, 2017
Articles, Pension design, Regulation,
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08Mar

Financial Inclusion and Consumer Protection in Peru

As part of its Global Policy Initiative, CGAP partnered with the Superintendence of Banks, Insurance and AFPs of Peru in late 2008, with the purpose of enhancing the understanding of the issues and trends in consumer relations when financial services are delivered through branchless banking, particularly through agents, which are used in ever increasing scale in Peru. The product was this joint report. The Superintendence and CGAP coordinated closely on data and information gathering, as well as on writing this...

March 8, 2017
Articles, Corporate Governance, Regulation, System Sustainability, ,
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February 2017

04Feb

The Political Economy of Underfunded Municipal Pension Plans

By Jeffrey Brinkman, Daniele Coen-Pirani & Holger Sieg This paper analyzes the determinants of underfunding of local government's pension funds using a politico-economic overlapping generations model. We show that a binding downpayment constraint in the housing market dampens capitalization of future taxes into current land prices. Thus, a local government's pension funding policy matters for land prices and the utility of young households. Underfunding arises in equilibrium if the pension funding policy is set by the old generation. Young households...

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

Private pension funds in Poland

By Lech Keller-Krawczyk This article takes a highly critical look at the pension system in Poland, which had been reformed after 1989 on the basis of the World Bank's 'three pillars' model of a combined state and private, mandatory and voluntary pensions system, despite evidence that the model is flawed and unobjective, being hinged on the inducements of cheaper credits for those countries adopting it. The author relates both the old and new pension systems in Poland, and describes the...

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

Analysing the Performance of the Pension Fund Industry with a Stochastic Frontier Model: A Case Study for Portugal

The enhanced role of occupational and personal pension plans in providing retirement income raises issues concerning efficiency and performance. This paper evaluates the performance of Portuguese pension fund management companies from 1994 to 2003, using a Cobb-Douglas stochastic cost frontier model to generate their efficiency scores. We conclude that the price of labour, the price of capital-management services and the price of capital-premises, as well as profits, the number of participants, the number of closed funds and the decision...

February 4, 2017
Articles, Corporate Governance, Investing
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