Note on the optimum pricing of annuities

Eytan Sheshinski

In a perfectly competitive market for annuities with full information, the price of annuities is equal to individuals (discounted) survival probabilities. That is, prices are actuarially fair. In contrast, the pricing implicit in social security systems invariably allows for cross subsidization between different risk groups (males/females). We examine the utilitarian approach to the optimum pricing of annuities and show how the solution depends on the joint distribution of survival probailities and incomes in the population.

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Year of publication:	March 2003
Authors:	Sheshinski, Eytan
Publisher:	Munich : CESifo, Center for Economic Studies & Ifo Institute
Subject:	Altersvorsorge \| Retirement provision \| Private Altersvorsorge \| Private retirement provision \| Versicherungsbeitrag \| Insurance premium \| Sterblichkeit \| Mortality \| Risikomodell \| Risk model \| Versicherungsökonomik \| Economics of insurance \| Theorie \| Theory

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Extent:	1 Online-Ressource (circa 14 Seiten) Illustrationen
Series:	CESifo working papers. - München : [Verlag nicht ermittelbar], ISSN 2364-1428, ZDB-ID 2065232-X. - Vol. no. 884
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Arbeitspapier ; Working Paper ; Graue Literatur ; Non-commercial literature
Language:	English
Other identifiers:	hdl:10419/76371 [Handle]
Classification:	G23 - Pension Funds; Other Private Financial Institutions ; H55 - Social Security and Public Pensions
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://www.econbiz.de/10011506431