TY  - JOUR
AU  - Bodie,Zvi
AU  - Pesando,James E.
TI  - Retirement Annuity Design in an Inflationary Climate
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 896
PY  - 1986
Y2  - September 1986
UR  - http://www.nber.org/papers/w0896
L1  - http://www.nber.org/papers/w0896.pdf
N1  - Author contact info:
Zvi Bodie
School of Management, room 534
Boston University
595 Commonwealth Ave.
Boston, MA   02215
Tel: 617-353-4160
E-Mail: zbodie@bu.edu

James Pesando
Institute for Policy Analysis
University of Toronto
140 St. George Street
Toronto, Ont  M5S 1A1  CANADA
E-Mail: pesando@chass.utoronto.ca
M1  - published as Zvi Bodie, James E. Pesando. "Retirement Annuity Design in an Inflationary Climate," in Zvi Bodie and John B. Shoven, editors, "Financial Aspects of the United States Pension System" University of Chicago Press (1983)

AB  - This paper examines the tilt and risk-return characteristics of real retirement incomes provided by variable annuities tied to bills, long-term bonds, stocks and a mixed portfolio which combines all three. The analysis emphasizes the riskiness of the real value of benefits provided by conventional nominal annuities. The Rockefeller Foundation Plan, together with the "ad hoc" cost-of-living adjustments made by many large firms, are interpreted as representative market responses to increased inflation uncertainty. The paper examines the annuity designs implicit in these innovations, and shows them to be variants of the standard variable annuity.
ER  -