Intergenerational risk sharing by funded pension schemes may increase welfare in an ex ante sense. However, it also suffers from a time inconsistency problem. In particular, young generations may be unwilling to start participating in a pension scheme if this requires them to make huge transfers...

Recent reforms that aim at reducing the upcoming burdens of population ageing might seriously harm low income individuals. An increase in old-age poverty and disability will be the result. Under this prospect, the present paper quantitatively characterizes the optimal progressivity of unfunded...

In this paper we consider the design and implementation of a pay-as-you-go social insurance system as a problem in political economy. We consider whether a society of forward looking rational economic agents would implement a system in which the level of benefits can depend on the relative...

The Financial Economists Roundtable (FER) is a group of senior financial economists who have made significant contributions to the finance literature and seek to apply their knowledge to current policy debates. The Roundtable focuses on microeconomic issues in investments, corporate finance, and...

In 2008, the oldest of 78 million baby boomers will celebrate their 62nd birthdays. Before they blow out their birthday candles, they will have considered and likely decided whether to elect to take early Social Security retirement benefits (SSRBs). Recent and evolving changes in the normal...

While the health risks associated with smoking are well known, the impact on income distributions is not. This paper extends the literature by examining the distributional effects of a behavioral choice, in this case smoking, on net marginal Social Security tax rates (NMSSTR). The results show...

Spanish Abstract: En este artículo revisamos los aspectos metodológicos del índice de revalorizacion de las pensiones españolas desarrollado a traves de la Ley 23/2013, reguladora del Factor de Sostenibilidad y del Índice de Revalorizacion del Sistema de Pensiones de la Seguridad Social. A...

The complex matrix of retirement policy trade-offs -encompassing elements of paternalism, market failure, and overlaying incentives in a life-cycle context- have received much attention in the literature. But the issue of whether publicly-funded retirement provision should be means-tested, and...

The 2008 Global Crisis and demographic trends in Indonesia, Malaysia, and Singapore has increased the urgency of reforming their pension systems for enhancing financial, fiscal, and economic sustainability over a long period, and mitigating possible adverse economic impacts. As national and...

I examine the effect of Old-Age Insurance systems on the labor supply of older men. Male retirement behavior is crucial to the solvency of OAI systems. Historical data on participation rates and OAI rules in thirteen developed countries show rapid falls in participation among men aged 60-4 after...