Using a representative sample of Italian investors, we estimate the risk associated with social security benefits by eliciting for each individual the subjective distribution of the replacement rate as a summary indicator of social security wealth. Pension risk varies across individuals in a way...

In 2000 Italy replaced its traditional system of severance pay for public employees with a new system. Under the old regime, severance pay was proportional to the final salary before retirement; under the new regime it is proportional to lifetime earnings. This reform entails substantial losses...