This paper studies how municipal governments jointly manage spending, credit market borrowing, and public employee pensions. I model governments as levered investors who must meet non-defaultable pension obligations and may value government spending more than citizens. I quantify the model using...

We propose a ‘buy, hold, sell’ (BHS) deterministic lifecycle strategy that involves buying and holding assets until they are sold to generate income. Savings are invested entirely into a risky portfolio until a pre-specified ‘switch age’ and then entirely into a risk-free portfolio after...

This paper examines how two instruments—annuities with lifelong benefits purchased using defined contribution (DC) plan assets, and social security annuities—should be considered jointly to optimize household lifetime wellbeing. Understanding how these interact is of key importance in order...

Using data from the first three waves of the Understanding America Study, the authors examine how public knowledge of the Social Security retirement program helps individuals to make optimal decisions about saving and the timing of benefit claiming. They use descriptive statistics to highlight...

Do workers value retirement benefits? We find that dollars paid in employer contributions to 401(k) plans have double the effect on a firm's recruiting success, relative to wage dollars. The effect is driven by higher-income and higher-age occupations. We use two novel instruments for...

Pension funds are increasingly relying on swaps to hedge the long-term nature of their liabilities. While the use of swaps reduces pension funds' exposure to interest rate risk, it exposes pension funds to liquidity risk because of potential margin calls. We study these effects using unique data...

This study aims to identify the challenges of implementing the Universal Pension Scheme (UPS) in Bangladesh. The study has adopted qualitative research methods to reach the aim. Based on the previous experience in the reformation of public financial management and in-depth interviews of the...

We introduce and analyze a novel collective defined contribution plan (CDC) which guarantees upon retirement at least a target benefit as a lump sum. The guarantee is provided by the remaining working generations under a pre-determined linear intergenerational risk sharing (IRS) rule.Through a...

We show that incorporating defined benefit pension funds in an asset pricing model with incomplete markets improves its ability to jointly match the historical equity premium and riskless rate, and has important implications for risk sharing. We emphasize the importance of the pension fund's...