Pension reform is high on the policy agenda of many advanced and emerging market economies. In advanced economies the challenge is generally to contain future increases in public pension spending as ...the population ages. In emerging market economies, the challenges are often different. Where pension coverage is extensive, the issues are similar to those in advanced economies. Where pension coverage is low, the key challenge will be to expand coverage in a fiscally sustainable manner. This volume examines the outlook for public pension spending over the coming decades and the options for reform in 52 advanced and emerging market economies.
This book challenges existing theories of welfare state change by analyzing pension reforms in France, Germany, and Switzerland between 1970 and 2004. It explains why all three countries were able to ...adopt far-reaching reforms, adapting their pension regimes to both financial austerity and new social risks. In a radical departure from the neo-institutionalist emphasis on policy stability, the book argues that socio-structural change has led to a multidimensional pension reform agenda. A variety of cross-cutting lines of political conflict, emerging from the transition to a post-industrial economy, allowed governments to engage in strategies of political exchange and coalition-building, fostering broad cross-class coalitions in support of major reform packages. Methodologically, the book proposes a novel strategy to analyze lines of conflict, configurations of political actors, and coalitional dynamics over time. This strategy combines quantitative analyses of actor configurations based on coded policy positions with in-depth case studies.
Looks at the policy choices involved in creating pension schemes, particularly whether it is advisable to move away from government pay-as-you-go pensions toward private or publicly funded plans. ...Examines the reasons for the controversy surrounding pension design, and whether the second level of pension systems should be mandatory, private, funded, and defined-contribution.
We compare the long-term output and current account effects of pension reforms that increase the retirement age with those of reforms that cut pension benefits, conditional on reforms achieving ...similar fiscal targets. We show the presence of a policy trade-off. Pension reforms that increase the retirement age have a large positive effect on output, but a small (and often negative) effect on the current account. In contrast, reforms that cut pension benefits improve the current account balance but reduce output. Mixed pension reforms, which extend the working life and cut pension benefits, can simultaneously boost output and the current account.
As of December 2008, state governments had approximately $1.94 trillion set aside in pension funds for their employees. How does the value of these assets compare to the present value of states' ...pension liabilities? Just as future Social Security and Medicare liabilities do not appear in the headline numbers of the U.S. federal debt, the financial liability from underfunded public pensions does not appear in the headline numbers of state debt. If pensions are underfunded, then the gap between pension assets and liabilities is off-balance-sheet government debt. We show that government accounting standards require states to use procedures that severely understate their liabilities. We then discuss the true economic funding of state public pension plans. Using market-based discount rates that reflect the risk profile of the pension liabilities, we calculate that the present value of the already-promised pension liabilities of the 50 U.S. states amount to $5.17 trillion, assuming that states cannot default on pension benefits that workers have already earned. Net of the $1.94 trillion in assets, these pensions are underfunded by $3.23 trillion. This “pension debt” dwarfs the states' publicly traded debt of $0.94 trillion. And we show that even before the market collapse of 2008, the system was economically severely underfunded, though public actuarial reports presented the plans' funding status in a more favorable light.
In Claiming Union Widowhood, Brandi Clay Brimmer analyzes the US pension system from the perspective of poor black women during and after the Civil War. Reconstructing the grassroots pension network ...in New Bern, North Carolina, through a broad range of historical sources, she outlines how the mothers, wives, and widows of black Union soldiers struggled to claim pensions in the face of evidentiary obstacles and personal scrutiny. Brimmer exposes and examines the numerous attempts by the federal government to exclude black women from receiving the federal pensions that they had been promised. Her analyses illustrate the complexities of social policy and law administration and the interconnectedness of race, gender, and class formation. Expanding on previous analyses of pension records, Brimmer offers an interpretive framework of emancipation and the freedom narrative that places black women at the forefront of demands for black citizenship.
In its June 2020 issue, Wirtschaftsdienst published an article entitled "Beitrags finanzierung im 'demografiegestressten' Rentensystem moglich" by Ernst Niemeier. Martin Werding takes a different ...view in a reply, and Ernst Niemeier explains his point of view in a response. JEL Classification: H53, H55, I38, J14 In der Juniausgabe 2021 veroffentlichte der Wirtschaftsdienst einen Aufsatz mit dem Titel "Beitragsfinanzierung im 'demografiegestressten' Rentensystem moglich" von Ernst Niemeier. Martin Werding vertritt in einer Replik eine andere Auffassung, im Anschluss erlautert Ernst Niemeier seinen Standpunkt in einer Erwiderung.
People covered by public pensions are often the subject of 'pension envy:' that is, their benefits might seem more generous and their contributions lower than those offered by the private sector. Yet ...this book points out that such judgments are often inaccurate, since civil servants hold jobs with few counterparts in private industry, such as firefighters, police, judges, and teachers. Often these are riskier, dirtier, and demand more loyalty and discretion than would be required of a more mobile labor force in the private sector. The debate challenges traditional ideas about how the public employee labor contract is structured and raises questions about how such employees are attracted to the public sector, retained and motivated on the job, and retired, via an entire compensation package of wages and benefits. Authors explore aspects of these schemes, addressing the cost and valuation debate, along with the political economy of how public pension asset pools are perceived and managed, an increasingly important topic in times of global financial turmoil. The discussion also explores ways that public pensions can be strengthened in the US, Japan, Canada, and Germany. The volume captures a vigorous debate currently underway by academics, financial experts, regulators, and plan sponsors, all seeking to define a new future for public retirement systems. It will be of substantial interest to a wide range of readers, since public sector employees and their representatives will naturally find the comparisons and arguments over valuation of keen interest. Public pension administrators and policymakers seeking an explanation of what makes these plans so costly will gain a new understanding of how the arguments stack up. Private sector employers and plan sponsors can learn much from efforts to reform these retirement systems in states and countries around the world. Finally, investors and the taxpaying public more generally may be at risk to cover these long-term promises, so it behoves them to pay close attention to the financing and investment practices of these plans, along with their valuation. This volume represents an invaluable addition to the Pension Research Council / Oxford University Press series as it includes actuarial, economic, and financial perspectives making it useful for academics, retirement plan administrators, and public employees wishing to understand the challenges facing public pensions. Available in OSO: http://www.oxfordscholarship.com/oso/public/content/management/9780199573349/toc.html Contributors to this volume - Neveen Ahmed, doctoral candidate in Economics, North Carolina State University, Beth Almeida, Executive Director, National Institute on Retirement Security, Gary Anderson, public pension consultant, Brad M. Barber, Professor of Finance, Graduate School of Management, UC Davis, Keith Brainard, research director, National Association of State Retirement Administrators, Robert L. Clark, Professor of Economics and Professor of Management, Innovation, and Entrepreneurship, North Carolina State University, Lee A. Craig, Alumni Distinguished Professor of Economics, North Carolina State University, Roderick B. Crane, Director of Institutional Client Services, TIAA-CREF, Jeremy Gold pension finance consultant, Michael Heller, Vice President of Actuarial Consulting Services, TIAA-CREF, Edwin C. Hustead, former Senior Vice President in charge of the Arlington, Virginia Hay Group actuarial practice and all Hay governmental actuarial and benefits consulting, Toni Hustead, former Chief of the Veterans Affairs and Defense Health Branch, US Office of Management and Budget, Executive Office of the President, Kelly Kenneally, communications advisor to the National Institute on Retirement Security, Gordon Latter, head of Pension and Endowment Strategy, Merrill Lynch Global Securities Research and Economics Group, David Madland, Director of the Work/Life Program, Center for American Progress, Raimond Maurer, endowed Chair of Investment, Portfolio Management, and Pension Finance, Finance Department, Goethe University of Frankfurt, Ken McDonnell, Program Director, American Savings Education Council, Washington, DC, Stephen T. McElhaney, senior public sector actuary, Mercer, Olivia S. Mitchell, Executive Director of the Pension Research Council, Wharton School, University of Pennsylvania , Silvana Pozzebon, Associate Professor, Department of Human Resources Management, HEC Montreal (Ecole des Hautes Etudes Commerciales de Montreal), Ralph Rogalla, Research Associate, Department of Finance, Goethe University of Frankfurt, Junichi Sakamoto, Chief Adviser to the Pension Management Research Group, Nomura Research Institute, M. Barton Waring, Chief Investment Officer for Investment Strategy and Policy, Barclays Global Investors, Emeritus, Paul J. Yakoboski, Principal Research Fellow, TIAA-CREF Institute, Parry Young, independent consultant on pension and other postemployment benefit issues related to US state and local governments.
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