Investing Archives - Page 4 of 4 - Pension Policy International

04FebFebruary 4, 2017

The 'Crisis' in Defined Benefit Corporate Pension Liabilities: Current Solutions and Future Prospects

By Gordon L. Clark & Ashby H. B. Monk Once an integral component of company-sponsored compensation schemes in many western economies, private defined benefit (DB) pensions are in decline. For many, DB schemes (and their related health care liabilities, depending on the jurisdiction) have hobbled the financial well-being of plan sponsors and even whole sectors of industry. If a constraint on shareholder value in the short-term, these schemes threaten long-term corporate survival in the emerging global economy. While there remains considerable debate...

February 4, 2017

Articles, Investing, Labor MarketCorporate Governance, Investing, Labor Market

04FebFebruary 4, 2017

Finance and Labor: Perspectives on Risk, Inequality and Democracy

By Sanford M. Jacoby This paper considers the association between financial development and labor-market outcomes such as risk and inequality. The relationship is not straightforward, however. It is mediated by politics at the national and corporate levels. Politics spurs financial development, which sets in motion countervailing efforts to restrain the effect of finance on inequality and risk. The empirical analysis relies on historical, comparative, and contemporary evidence. Emphasis is given to recent events in the United States: the political origins...

February 4, 2017

Articles, Labor Market, Regulation, System SustainabilityFinancial Inclusion, Investing, Risk, Sustainability

04FebFebruary 4, 2017

What Replacement Rates do Households Actually Experience in Retirement?

By Alicia H. Munnell & Mauricio Soto This paper estimates how much people actually receive in retirement relative to earnings before retirement when all sources of income, including income generated by homeownership, are combined. Previous studies find that middle class people need between 70 and 75 percent of their pre-retirement earnings to maintain their life style once they stop working. The objective of this study is to determine what people are actually receiving in retirement. Regardless of how retirement income and...

February 4, 2017

Articles, Investing, SavingsInvesting, Replacement Rates, Savings

04FebFebruary 4, 2017

Technical Review Panel for the Pension Insurance Modeling System (PIMS)

By Olivia S. Mitchell, Christopher Geczy, Robert Novy-Marx, Raimond Maurer, Donald E. Fuerst, Christopher Bone, Donald J. Segal, Martin G. Clarke, Frank J. Fabozzi, Deborah Lucas & David F. Babbel In April of 2013, the Pension Research Council of the Wharton School at the University of Pennsylvania convened a Technical Review Panel, comprising ten experts whose task it was to review the Pension Benefit Guaranty Corporation’s (PBGC) Pension Insurance Modeling System (PIMS), including inputs, outputs, and model assumptions. The review...

February 4, 2017

Articles, Corporate Governance, Pension designInvesting, Labor Market

04FebFebruary 4, 2017

Security of Retirement Benefits in Canada: You Bet Your Life?

By Ronald B. Davis This paper provides a careful review and analysis of employment-based pensions and other post-retirement benefits that may be available to Canadian workers when they retire, with particular emphasis on the extent to which such benefits are vulnerable to unilateral employer alteration or cancellation, and to the risks which arise in the event of the employer's insolvency. Taking stock of key differences between the rights of unionized employees and non-unionized ones, the author argues that the legal...

February 4, 2017

Adequacy, Articles, Labor Market, RegulationInvesting, Regulation

04FebFebruary 4, 2017

How Should the Adequacy of Pension Coverage Be Balanced Against Financial Sustainability?

By Krzysztof Hagemejer & John Woodall In recent decades many countries have “reformed” their contributory pension schemes, generally strengthening the links between benefit entitlements and the contributions paid over members’ working lifetimes, but primarily seeking to (re)balance them financially, in the face of strains arising from unfavourable labour market or demographic conditions. The result has been reduced benefit entitlements and levels of coverage, however assessed. The impact has been felt, particularly, by those with shorter, broken careers (due for example...

February 4, 2017

Adequacy, Articles, System SustainabilityCoverage, Investing, Sustainability

04FebFebruary 4, 2017

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, InvestingInvesting, Risk

04FebFebruary 4, 2017

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, InvestingInvesting, Risk

12JanJanuary 12, 2017

Building Long-Term Portfolio Benchmarks for Pension Funds in Emerging Economies

By Jorge Sabat - The movement from a defined benefit to a defined contribution pension system has important implications in the area of portfolio allocation. While the focus of defined benefit pension funds is essentially in the long term, some defined contribution funds might have incentives to invest with shorter-term horizons. The case of open pension funds, such as the ones in several countries in Latin America and Central and Eastern European countries, shows that competition on short-term returns may...

January 12, 2017

Adequacy, InvestingInvesting

February 2017

The 'Crisis' in Defined Benefit Corporate Pension Liabilities: Current Solutions and Future Prospects

Finance and Labor: Perspectives on Risk, Inequality and Democracy

What Replacement Rates do Households Actually Experience in Retirement?

Technical Review Panel for the Pension Insurance Modeling System (PIMS)

Security of Retirement Benefits in Canada: You Bet Your Life?

How Should the Adequacy of Pension Coverage Be Balanced Against Financial Sustainability?

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

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

January 2017

Building Long-Term Portfolio Benchmarks for Pension Funds in Emerging Economies