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Annuity Options in Public Pension Plans : The Curious Case of Social Security Leveling
Clark, Robert L. - 2017
Social Security Leveling is an annuity option that allows participants to receive a level income before and after age 62. The retiree receives a larger pension benefit prior to age 62, but then the pension benefit is lowered at age 62 when the individual is expected to claim Social Security...
Persistent link: https://www.econbiz.de/10012960660
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Annuity Pricing in Public Pension Plans : Importance of Interest Rates
Abashidze, Nino - 2018
There is little systematic information on the distribution options in public sector retirement plans and how annuity options are priced relative to the standard single life annuity. This study examines the distribution options of 85 large public retirement plans covering general state employees,...
Persistent link: https://www.econbiz.de/10012906774
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Life is Cheap : Using Mortality Bonds to Hedge Aggregate Mortality Risk
Friedberg, Leora - 2010
Using the widely-cited Lee-Carter mortality model, we quantify aggregate mortality risk as the risk that the average annuitant lives longer than is predicted by the model, and we conclude that annuity business exposes insurance companies to substantial mortality risk. We calculate that a markup...
Persistent link: https://www.econbiz.de/10012761756
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Leaving Big Money on the Table : Arbitrage Opportunities in Delaying Social Security
Bronshtein, Gila - 2016
Recent research has documented that delaying the commencement of Social Security benefits increases the expected present value of retirement income for most people. Despite this research, the vast majority of individuals claim Social Security at or before full retirement age. Claiming Social...
Persistent link: https://www.econbiz.de/10012978533
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Putting the Pension Back in 401(K) Plans : Optimal Versus Default Longevity Income Annuities
Horneff, Vanya - 2016
Most defined contribution pension plans pay benefits as lump sums, yet the US Treasury has recently encouraged firms to protect retirees from outliving their assets by converting a portion of their plan balances into longevity income annuities (LIA). These are deferred annuities which initiate...
Persistent link: https://www.econbiz.de/10012981624
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A New Use of Importance Sampling to Reduce Computational Burden in Simulation Estimation
Ackerberg, Daniel A. - 2011
Method of Simulated Moments (MSM) estimators introduced by McFadden (1989)and Pakes and Pollard (1989) are of great use to applied economists. They are relatively easy to use even for estimating very complicated economic models. One simply needs to generate simulated data according to the model...
Persistent link: https://www.econbiz.de/10013127757
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One-Node Quadrature Beats Monte Carlo : A Generalized Stochastic Simulation Algorithm
Judd, Kenneth L. - 2011
In conventional stochastic simulation algorithms, Monte Carlo integration and curve fitting are merged together and … stochastic simulation approach in which integration and curve fitting are separated. We specifically allow for the use of … achieve accuracy of solutions that is orders of magnitude higher than that of the conventional stochastic simulation …
Persistent link: https://www.econbiz.de/10013131303
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Merging Simulation and Projection Approaches to Solve High-Dimensional Problems
Judd, Kenneth L. - 2012
We introduce an algorithm for solving dynamic economic models that merges stochastic simulation and projection … approaches: we use simulation to approximate the ergodic measure of the solution, we construct a fixed grid covering the support …
Persistent link: https://www.econbiz.de/10013098481
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Estimating the Economic Impacts of Living Wage Mandates Using Ex Ante Simulations, Longitudinal Estimates, and New Public and Administrative Data : Evidence for New York City
Neumark, David - 2012
Policy researchers often have to estimate the future effect of imposing a policy in a particular location. There is often historical information on the effects of similar policies in other jurisdictions, but no information on the effects of the policy in the jurisdiction in question, and the...
Persistent link: https://www.econbiz.de/10013106657
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Aging and Pension Reform : Extending the Retirement Age and Human Capital Formation
Vogel, Edgar - 2013
Projected demographic changes in industrialized and developing countries vary in extent and timing but will reduce the share of the population in working age everywhere. Conventional wisdom suggests that this will increase capital intensity with falling rates of return to capital and increasing...
Persistent link: https://www.econbiz.de/10013085913