NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Optimal retirement benefit guarantees

Stavros Panageas

NBER Working Paper No. 15805
Issued in March 2010
NBER Program(s):   AG   AP   PE

Retirement benefit guarantees can ensure a minimum standard of living in retirement. I propose a framework to discuss the design of such guarantees. The model features a standard life-cycle setting, in which individual agents’ choices can have negative external effects on public finances, whenever their retirement consumption drops below a minimum level. Within this framework, I derive two alternative forms of intervention that can efficiently deliver a minimum standard of living to retirees. According to the first policy, agents use part of their accumulated assets to purchase a claim providing a fixed income stream for the duration of their life. According to the second policy, they purchase an appropriately structured portfolio insurance policy.

download in pdf format
   (405 K)

email paper

The NBER Bulletin on Aging and Health provides summaries of publications like this.  You can sign up to receive the NBER Bulletin on Aging and Health by email.

This paper is available as PDF (405 K) or via email.

Acknowledgments

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w15805

Users who downloaded this paper also downloaded these:
Afonso, Kovner, and Schoar w15806 Stressed not Frozen: The Fed Funds Market in the Financial Crisis
Horneff, Maurer, Mitchell, and Stamos w12942 Money in Motion: Dynamic Portfolio Choice in Retirement
Bi and Leeper w15810 Sovereign Debt Risk Premia and Fiscal Policy in Sweden
Mulligan w15800 Simple Analytics and Empirics of the Government Spending Multiplier and Other “Keynesian” Paradoxes
Kopczuk w15741 Economics of estate taxation: a brief review of theory and evidence
 
Publications
Activities
Meetings
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us