“Should Icelandic pension funds hedge currency risk in their foreign investments?” by Asgeir Daníelsson (Working Papner No. 65, August 2014, .pdf format, 30p.).
This paper discusses efficient hedging of currency risk in foreign investments through short term forward contracts. It is shown that for long term investors the efficient level of currency hedging depends on the behaviour of the exchange rate. If the exchange rate follows random walk the efficient hedging of the currency risk may be as large as it is for the short term investor, or possibly larger, but if the exchange rate follows a stationary stochastic process efficient hedging of the long term currency risk through short term forward contracts is zero in most cases. It is also shown that pass through of changes in the exchange rate into inflation forms a partial hedge for an investor that considers the real return and its volatility rather than the nominal return, diminishing the efficient level of forward currency contracts. It is shown that it is possible to use forward currency contracts for speculative investments. These contracts are profitable investment opportunities if the interest rate di¤erential exceeds the expected change in the exchange rate. This same condition motivated the carry trade.
“Optimal Redistributive Pensions and the Cost of Self-Control,” by Pier-Andre Bouchard St-Amant and Jean-Denis Garon (CESifo Working Paper No. 4937, August 2014, .pdf format, 28p.). Note: Links to the abstract and the full text of the paper available at:
“Private Defined Benefit Pension Plans in the U.S. National Accounts: Accrual Measures for the 2013 Comprehensive Revision,” by Dylan G. Rassier (August 2014, .pdf format, 33p.).
With the comprehensive revision of the U.S. National Income and Product Accounts published in July 2013, the U.S. Bureau of Economic Analysis introduced new accrual-based measures of income generated by defined benefit (DB) pension plans. In addition to the improved measurement, BEA introduced a new DB pension subsector and a new set of tables that provide a complete picture of transactions conducted in the DB pension subsector. Separate tables were introduced for each sector of employers that sponsor DB plans: business or private sector, state and local government sector, and federal government sector. This paper summarizes the methodology for each of the estimated series included in the table for DB plans sponsored by business or private sector employers (i.e., private plans). In addition, the paper provides general background information on DB pension plans and summarizes the DB pension subsector and the related table for private DB plans.
“Private Sector Multiemployer Pension Plans – A Primer,” by Alicia H. Munnell and Jean-Pierre Aubry (IB No. 14-13, August 2014, .pdf format, 12p.).
A. EBRI Notes (Vol. 35, No. 8, August 2014, .pdf format). Note: The two articles in this issue are: “Satisfaction With Health Coverage and Care: Findings from the 2013 EBRI/Greenwald & Associates Consumer Engagement in Health Care Survey,” by Paul Fronstin; and, “Contributory “Negligence?” The Impact of Future Contributions to Defined Contribution Plans on Retirement Income Adequacy for Gen Xers,” by Jack VanDerHei.
B. “”Crisis” Management: Uncertainty and the Workplace,” by Nevin Adams and Dallas Salisbur (Issue Brief No. 403, August 2014, .pdf format, 20p.).
“From Me to You? How the UK State Pension System Redistributes,” by Rowena Crawford , Soumaya Keynes and Gemma Tetlow (w14/20, August 2014, .pdf format, 62p.). Note: Links to the abstract and the full text of the paper available at:
“Retirement, Early Retirement and Disability: Explaining Labor Force Participation after 55 in France,” by Luc Behaghel, Didier Blanchet and Muriel Roger (Working Paper No. 500, 2014, .pdf format, 43p.). Note: Links to the abstract and the full text of the paper available at:
A. “The automatic adjustment of pension expenditures in Spain: an evaluation of the 2013 pension reform,” by Alfonso R. Sanchez (Working Paper 1420, July 2014, .pdf format, 57p.).
This paper simulates the future performance of the Spanish pension system using a large OLG model. We compare the system in place after the 2011 pension reform to that emerging after the latest (2013) institutional changes. In particular, we explore the workings of the new indexing mechanism, linking pension payments to life expectancy and to the system’s aggregate flows of income and expenditure. We consider several alternative eco-demographic environments in our analysis and assess the welfare consequences for the different cohorts affected. Overall, the new automatic adjusting mechanism is broadly successful in its goal of stabilising the financial condition of the system. But the welfare costs imposed on some cohorts (e g. young workers at the beginning of the reform) is very heavy.
B. “From Bismarck to Beveridge: the other pension reform in Spain,” by J. Ignacio Conde-Ruiz and Clara I. Gonzalez (Working Paper 1417, July 2014, .pdf format, 36p.).
Aging is an unstoppable process and it remains a major challenge for the sustainability of the PAYG pension system in most developed countries, including in Spain. Many countries need to introduce reforms of their pension systems in order to control their expenditure, and in some cases this has already begun. However, there are other sorts of changes to certain parameters that are perceived as secondary, e.g. the different path of minimum and maximum pensions, and the upper and lower caps on contributions. This has significant implications for the distributive structure of the social security system that cannot be readily perceived by the population. That is why some economists in Spain refer to it as the “Silent Reform”. The aim of this paper is to analyse the consequences this type of reform would have in Spain; indeed, it is the first paper to actually quantify and evaluate the potential impact it would have on the country. We have used an accounting model with heterogeneous agents and overlapping generations in order to project pension expenditures up until 2070. The results show that this kind of reform could potentially contain future expenditure and could also change the nature of the pension system from a contributory or Bismarckian-type system into an assistential or Beveridgean-type one. This change could have significant consequences as both systems have different objectives. The paper also shows that the institutional characteristics that make this kind of reform in Spain feasible are also present in most developed countries with Bismarckian pension systems. Therefore, we believe that the lessons learned in this paper on this kind of reform could well prove useful to other countries.
“The Effects of a Non-Contributory Pension Program on Labor Force Participation: The Case of 70 y Más in Mexico,” by Laura Juarez González and Tobias Pfutze (Working Paper No. 2014-12, June 2014, .pdf format, 53p.).
We estimate the effect of 70 y Mas, an age-conditioned transfer program for individuals age 70 and older in rural Mexico, on the labor force participation of beneficiaries and of younger individuals who live with them. Using data from the 2010 Mexican Census, we exploit the age and locality population thresholds to identify the effects of the program. We find that the program reduces the labor force participation of elderly men, particularly of those who live alone and who are relatively poor, but has a much weaker effect on that of elderly women. The program has no statistically significant effect on the labor force participation of either prime-age men or women who live with potential beneficiaries, and it has a negative and significant effect on the labor force participation of boys age 12 to 17, particularly those in the lowest wealth quintiles, but not on that of same-age girls. These results suggest that the program affects mostly the labor supply of the intended beneficiaries, and that of marginal workers, like adolescent boys.
“Employers’ pension provision survey 2013,” (Research Report No. 881, July 2014, .pdf format, 147p.).
A. “Comparing the Robustness of PAYG Pension Schemes,” by Falilou Fall (Working Paper No. 1134, July 2014, .pdf format, 32p.). Note: Links to the abstract and the full text of the paper available at:
B. “Overcoming Vulnerabilities of Pension Systems,” by Falilou Fall and Debra Bloch (Working Paper No. 1133, July 2014, .pdf format, 50p.). Note: Links to the abstract and the full text of the paper available at:
“Target-Benefit Plans in Canada – An Innovation Worth Exploring,” by Anglea Mazerolle, Jana Steele, and Mel Bartlett (No. 411, July 2014, .pdf format, 20p.).
A. “Pension Advance Transactions: Questionable Business Practices Identified,” (GAO-14-420, June 2014, .pdf format, 65p.).
B. “Private Pensions: Targeted Revisions Could Improve Usefulness of Form 5500 Information,” (GAO-14-441, June 2014, .pdf format, 83p.).
A. “An Update on Pension Obligation Bonds,” by Alicia H. Munnell, Jean-Pierre Aubry and Mark Cafarelli (SLP No. 40, July 2014, .pdf format, 12p.).
B. “Medicaid and the Elderly,” by Mariacristina De Nardi, Eric French and John Bailey Jones (IB No. 14-10, June 2014, .pdf format, 7p.).
Witness statements from the 2014 ERISA Advisory Council session are now available (.pdf format).
“Pensioners’ Incomes Series 2012 to 2013,” (July 2014, .pdf format, 102p.).
“FY 2013 Projections Report,” (June 2014, .pdf format, 54p.)
US Census Bureau Data Update: “Quarterly Survey of Public Pensions: State & Local Government – 2014 First Quarter,” (June 2014, Excel format).
A. “Social interactions and the retirement age,” by Niels Vermeer, Maarten van Rooij and Daniel van Vuuren (Working Paper No. 426, June 2014, .pdf format, 29p.). Note: Links to the abstract and full-text can be found at:
B. “The measurement of international pension obligations – Have we harmonised enough?” by Dirk van der Wal (Working Paper No. 424, May 2014, .pdf format, 28p.). Note: Links to the abstract and full-text can be found at:
“The Funding of State and Local Pensions: 2013-2017,” by Alicia H. Munnell,” by Jean-Pierre Aubry and Mark Cafarelli (SLP No. 39, June 2014, .pdf format, p.).
“Non-contributory pensions,” by Rosangela Bando, Paul Gertler, and Sebastian Galiani (IDB-WP-517, June 2014, .pdf format, 27p.). Note: Links to the abstract and full-text can be found at:
“Understanding Cuts to Public Pensions,” by Monique Morrissey (Issue Brief No. 379, .pdf and HTML format, 19p.).
“National Health Service Pension Scheme: actuarial valuation at 31 March 2012,” by Trevor Llanwarne and Sue Vivian (June 2014, .pdf format, 46p.).
“Defined Ambition pension schemes,” by Djuna Thurley (SN06902, June 2014, .pdf format, 18p.).
“Pension Design with a Large Informal Labor Market: Evidence from Chile,” by Clement Joubert (Discussion Paper No. 8211, May 2014, .pdf format, 60p.). Note: Links to the abstract and full-text can be found at:
“How Will Rhode Island’s New Hybrid Pension Plan Affect Teachers?” by Richard W. Johnson, Barbara Butrica, Owen Haaga, and Benjamin G. Southgate (May 2014, .pdf format, 28p.).
EBRI Notes (Vol. 35, No. 5, May 2014, .pdf format, 10p.). Note: The title article in this issue is “Trends in Health Coverage for Part-Time Workers, 1999-2012,” by Paul Fronstin; and, “Take it or Leave it? The Disposition of DC Accounts: Who Rolls Over into an IRA? Who Leaves Money in the Plan and Who Withdraws Cash?” by Sudipto Banerjee.
“Proving incentives for long-term investment by pension funds — the use of outcome-based benchmarks,” by Fiona Stewart (WPS 6885, May 2014, .pdf and ASCII text format, 26p.). Note: Links to the abstract and full-text can be found at:
“Guaranteed Minimum Pension – annual increases,” by Djuna Thurley (SN04956, May 2014, .pdf format, 5p.).
A. “COLA Cuts in State/Local Pensions,” by Alicia H. Munnell, Jean-Pierre Aubry and Mark Cafarelli (SLP No. 38, May 2014, .pdf format, 8p.).
B. “Defined Contribution Plans in the Public Sector: An Update,” by Alicia H. Munnell, Jean-Pierre Aubry and Mark Cafarelli (SLP No. 37, May 2014, .pdf format, 14p.).
“The Role Of Economic, Fiscal, And Financial Shocks In The Evolution Of Public Sector Pension Funding,” by Robert K. Triest and Bo Zhao (Working Paper No. 13-26, May 2014, .pdf format, 25p.). Note: Links to the abstract and full-text can be found at:
A. “How Will State and County Government Employees Fare under Kentucky’s New Cash Balance Pension Plan?” by Richard W. Johnson and Benjamin G. Southgate (April 2014, .pdf format, 27p.).
B. “When Do State and Local Pension Plans Encourage Workers to Retire?” by Richard W. Johnson, Barbara Butrica, Owen Haaga, and Benjamin G. Southgate (April 2014, .pdf format, 3p.).
C. “How Long Must State and Local Employees Work to Accumulate Pension Benefits?” by Richard W. Johnson, Barbara Butrica, Owen Haaga, and Benjamin G. Southgate (April 2014, .pdf format, 6p.).
D. “Do State and Local Pensions Lock In Mid-Career Employees?” by Richard W. Johnson, Barbara Butrica, Owen Haaga, and Benjamin G. Southgate (April 2014, .pdf format, 3p.).
“Scotland analysis: Work and pensions,” (April 2014, .pdf and Rich-text format, 115p.).
American Journal of Epidemiology (Vol. 179, No. 8,9, Apr. 15, 2014, May 1, 2014).
Apr. 15, 2014:
May 1, 2014:
Global Public Health (Vol. 9, No. 3, March 2014).
Economic Journal (Vol. 174, No. 575, March 2014).
“Private Pensions: Pension Tax Incentives Update,” (GAO-14-334R, March 2014, .pdf format, 31p.).
“Why Don’t Lower-Income Individuals Have Pensions?” by April Yanyuan Wu, Matthew S. Rutledge and Jacob Penglase (IB No. 14-8, April 2014, .pdf format, 7p.).
GESIS has recently added the following dataset to its holdings:
- Saving and old-age provision in Germany (SAVE) 2013… (ZA5647)
“Ottawa’s Hidden Deficit: The Widening Gap between Federal Government Pension Liabilities and Assets,” by William B.P. Robson and Alexandre Laurin (Commentary No. 406, April 2014, .pdf format, 18p.).
“Employers’ Pension Provision Survey 2013: Preliminary findings,” by John Forth, Lucy Stokes, Catherine Grant, and Sam Sullivan (DWP Ad Hoc Research Report no. 1, April 2014, .pdf format, 34p.).
“Is Pension Coverage a Problem in the Private Sector?” by Alicia H. Munnell and Dina Bleckman (IB No. 14-7, April 2014, .pdf format, 7p.).