February 2017

04Feb

Optimal Social Security Claiming Behavior under Lump Sum Incentives: Theory and Evidence

By Raimond Maurer, Olivia S. Mitchell, Ralph Rogalla & Tatjana Schimetschek People who delay claiming Social Security receive higher lifelong benefits upon retirement. We survey individuals on their willingness to delay claiming later, if they could receive a lump sum in lieu of a higher annuity payment. Using a moment-matching approach, we calibrate a lifecycle model tracking observed claiming patterns under current rules and predict optimal claiming outcomes under the lump sum approach. Our model correctly predicts that early claimers...

February 4, 2017
Articles, Pension design, Regulation, ,
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04Feb

The Separation of Intelligence and Control: Retirement Savings and the Limits of Soft Paternalism

By Jacob Russell “Soft paternalism” is in vogue among academics and lawmakers, but too much is being asked of it. This Article studies soft paternalist techniques — including nudging and disclosure — that have been used in the employer-sponsored retirement system. Defined-contribution retirement plans represent an ideal test case for libertarian paternalism: there has been extensive experimentation, and it has often been held up as a success by nudge advocates. In particular, this Article focuses on investment allocation decisions in...

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

The Life-Cycle Personal Accounts Proposal for Social Security: An Evaluation

By Robert J. Shiller The life-cycle accounts proposal for Social Security reform has been justified by its proponents using a number of different arguments, but these arguments generally involve the assumption of a high likelihood of good returns on the accounts. A simulation is undertaken to estimate the probability distribution of returns in the accounts based on long-term historical experience. U.S. stock market, bond market and money market data 1871-2004 are used for the analysis. Assuming that future returns behave...

February 4, 2017
Articles, Labor Market, Savings
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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

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 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

Sharing High Growth across Generations: Pensions and Demographic Transition in China

By Zheng Michael Song, Kjetil Storesletten, Yikai Wang & Fabrizio Zilibotti Intergenerational inequality and old-age poverty are salient issues in contemporary China. China’s aging population threatens the fiscal sustainability of its pension system, a key vehicle for intergenerational redistribution. We analyze the positive and normative effects of alternative pension reforms, using a dynamic general equilibrium model that incorporates population dynamics and productivity growth. Although a reform is necessary, delaying its implementation implies large welfare gains for the (poorer) current generations, imposing only small...

February 4, 2017
Articles, Labor Market,
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04Feb

Lessons for an Aging Society: The Political Sustainability of Social Security Systems

By Vincenzo Galasso & Paola Profeta What is the future of social security systems in OECD countries? In our view, the answer belongs to the realm of politics. We evaluate how political constraints shape the social security system in six countries - France, Germany, Italy, Spain, the UK and the US - under population aging. Two main aspects of the aging process are relevant to the analysis. First, the increase in the dependency ratio - the ratio of retirees to...

February 4, 2017
Aging, Articles, Labor Market, ,
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04Feb

The Embedded Firm: Corporate Governance, Labor, and Finance Capitalism

By Peer C. Zumbansen & Cynthia A. Williams This paper constitutes the introduction to an edited collection, THE EMBEDDED FIRM: LABOR, CORPORATE GOVERNANCE AND FINANCE CAPITALISM (Cambridge University Press, 2011). This book brings together contributions from law, economics, sociology and politics in order to evaluate the effects of the shift to shareholder primacy in both the United States and the United Kingdom, in the context of an increasingly financialized economy. Contributors include Ruth Aguilera, William Allen, Harry Arthurs, Blanaid Clark,...

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