The credit crisis has reduced the funding ratios of Dutch pension funds to a historical minimum. Pension funds now face two challenges. The first is to timely restore funding ratios to safe levels without jeopardizing labour market conditions that also have worsened because of the crisis. The...

This paper develops an analytical framework for the design of pension systems, taking the functions of the pension system as the guiding principle. It discusses the economic principles underlying these functions and their implementation in practice. In particular, it distinguishes three...

This paper takes stock of the evolution in pension systems and the challenges that remain for the future. It derives a typology of pension systems and uses this to discuss the strengths and weaknesses of alternative systems. After describing how pension systems in the industrial world have been...

Stand-alone collective pension schemes are an attractive third way between the extensive public pay-as-you-go schemes of continental Europe and the individual pension plans that are increasingly replacing defined-benefit plans in the Anglo-Saxon countries. If a number of further reforms are...

Dutch occupational defined-benefit plans suffer from a number of serious weaknesses, including ambiguous ownership of the surplus, back-loading of benefits, and lack of tailor-made risk management. To address these weaknesses, we propose collective individual defined-contribution plans that are...

Private pension provision faces the challenging task of providing stable income streams during retirement. The challenge has increased markedly in the last decades due to volatile financial markets, falling interest rates and the withdrawal of employers and external insurers as risk bearers of...

Rising longevity and falling fertility threaten the sustainability of pay-as-you-go pension chemes. This paper shows that maintaining the intergenerational balance in the Dutch pay-as-you-go pension scheme in the face of increased longevity since the introduction of the scheme in 1957 would have...

A number of trends are changing the nature of social risks and increase the importance of human capital, adaptability and flexibility. This paper discusses the usefulness of a lifecourse perspective in developing proactive social policies that better fit the changing life cycles of individuals...

This paper reviews the literature on the optimal design and regulation of funded pension schemes. We first characterize optimal saving and investment over an individual’s life cycle. Within a stylized modeling framework, we explore optimal individual saving and investing behavior....