Preferences for deferred annuities in the Japanese retirement market

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Tomoki Kitamura ◽  
Kunio Nakashima
Keyword(s):  
Design Methodology ◽  
Pension Plans ◽  
Internet Survey ◽  
Financial Assets ◽  
Defined Contribution ◽  
Stated Choice ◽  
Content Type ◽  
Longevity Insurance ◽  
Saving Decisions ◽  
Stated Choice Experiments

Purpose Deferred annuities, which offer longevity insurance with relatively low premiums, are a potential payout option in defined contribution (DC) pension plans in Japan. This study aims to measure individual preferences for these annuities. Design/methodology/approach This study conducts stated choice experiments using an original internet survey. This methodology provides a decision-making scenario similar to that faced by individuals when making real retirement saving decisions. Subjective valuations of deferred, immediate and term annuities are compared. Findings This study finds that male individuals have an insignificant preference for deferred annuities – the benefits of which begin at an advanced age. On average, deferred annuities are considered a gamble, betting against life and individuals who are married and have higher financial assets tend to value them less. Originality/value While previous studies, based on theory and simulations, have found that deferred annuities should be included in individual retirement assets, this study examines annuity preferences from the demand side (i.e. DC plan participants) –an approach that has not been addressed in the literature.

Are the saving decision patterns of bank customers also clouded by psychological biases? Evidence from Ghana

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Joseph Emmanuel Tetteh ◽  
Christopher Boachie
Keyword(s):  
Decision Making ◽  
Loss Aversion ◽  
Design Methodology ◽  
Weighted Least Squares ◽  
Least Squares Regression ◽  
Individual Decision ◽  
Content Type ◽  
Saving Decisions ◽  
The Individual ◽  
Practical Implications

PurposeThis paper attempts to investigate the influence of psychological biases on saving decision-making of bank customers in Ghana.Design/methodology/approachIt employs weighted least squares regression to test the effect of psychological biases on savings decisions of bank customers.FindingsThe findings show that all the nine psychological biases, namely mental accounting, availability, loss aversion, representativeness, anchoring, overconfidence, status quo, framing effect and disposition effect employed for the study have a significant influence on saving decision of bank customers. The results depict that psychological biases are entrenched in the saving pattern of bank customers in Ghana.Practical implicationsFor policy purposes, the study recommends that bank customers need to enhance their knowledge of psychological biases in order to improve their gains from savings, and not to fall prey to these prejudices. The satisfied customer is a dependable source of bank viability and survival.Originality/valueTo the best of the knowledge of the author, this study provides the first empirical evidence of the influence of psychological biases on saving decisions of bank customers in Ghana. The findings of this study will enhance knowledge on the influence of psychological biases on individual decision-making and will accentuate the fact that the individual is not an entirely rational being.

The impact of employer-delayed deposits on plan participant wealth

2016 ◽  
Vol 42 (12) ◽  
pp. 1171-1179
Author(s):  
Jeffrey Scott Jones
Keyword(s):  
Design Methodology ◽  
Defined Contribution ◽  
Regulatory Oversight ◽  
Content Type ◽  
Defined Contribution Plans ◽  
Economic Significance ◽  
History Of ◽  
Defined Contribution Plan ◽  
The Impact ◽  
Primary Contribution

Purpose The purpose of this paper is to examine the impact of employer-delayed deposits to defined contribution plans on plan participant wealth. The history of regulatory oversight on the obligations of employers to remit deposits to defined contribution plans on behalf of employees is discussed. In light of these regulations, the paper discusses and examines situations in which employers may legally delay the deposit of employee contributions to a defined contribution plan and how the existence of various calendar anomalies may impact the returns of plan participants. Design/methodology/approach Simulated equity portfolios over the period 1985-2014 are created to determine the economic significance of possible delays in plan deposits on the accumulated wealth of plan participants. Findings The findings suggest that in situations where employees are paid monthly at the end of the month, it is always to their benefit to have their funds deposited as soon as possible. However, for employees paid weekly at the end of the week, a slight delay (one to three days) in the deposit of funds by the employer may actually be beneficial for the employee, particularly if the employee invests heavily in small and mid-cap stocks. Originality/value This is the first paper to explicitly study the impact of an employer’s timing of deposits to a defined contribution plan on the accumulated wealth of plan participants, and is thus the primary contribution of the paper.

Agritourism consumers’ participation in wine tasting events

2014 ◽  
Vol 26 (2) ◽  
pp. 120-138 ◽  
Author(s):  
Ramu Govindasamy ◽  
Kathleen Kelley
Keyword(s):  
Design Methodology ◽  
Direct Marketing ◽  
Internet Survey ◽  
Behavioral Characteristics ◽  
Graduate Degree ◽  
Atlantic Region ◽  
Content Type ◽  
Wine Tourism ◽  
On Farm ◽  
Practical Implications

Purpose – The purpose of this study is to determine the likelihood of a USA Mid-Atlantic region consumers’ willingness to partake in a wine tasting event, an example of an agritourism activity, based on their responses to an Internet survey conducted from June 22 to 29, 2010. Design/methodology/approach – Potential participants were screened and asked to participate if they resided in one of the states targeted (Delaware, New Jersey or Pennsylvania); were aged 21 years and older; were the primary food shopper for the household; and had previously attended an agritourism and/or direct marketing events or activities. Findings – A logit model was developed based on responses from 972 consumers who participated in the 15-minute Internet survey to predict participation in wine tasting activity. Consumers who are more likely to attend an on-farm wine tasting event include those who learn about agritourism events through newspapers, think that the variety and price of produce is better at direct markets than supermarkets, are older than 50 years, have a graduate degree and are self-employed. Research limitations/implications – Empirical results will help agritourism operators enhance marketing efforts and develop profitable on-farm agricultural activities by identifying consumer segments likely to participate in wine tourism activities. Practical implications – This paper helps identify consumer segments that are more likely to participate in a wine tasting event and provides marketers with the ability to target likely buyers based on corresponding demographic characteristics. Originality/value – This paper identifies likely wine tasting participants based on demographics, psychographics and behavioral characteristics.

Management of pension discount rate and financial health

2016 ◽  
Vol 8 (2) ◽  
pp. 142-162
Author(s):  
Paula Diane Parker ◽  
Nancy J. Swanson ◽  
Michael T. Dugan
Keyword(s):  
Earnings Management ◽  
Discount Rate ◽  
Design Methodology ◽  
Pension Plans ◽  
Financial Health ◽  
Z Score ◽  
Bottom Line ◽  
Content Type ◽  
The Impact

Purpose This study aims to examine the unexpected portion of the pension discount rate to determine if the pension discount rate is being used to manage earnings for both financially healthy and financially unhealthy firms as categorized based upon their Altman z-score for bankruptcy. Design/methodology/approach Regression analysis is conducted with the unexpected portion of the pension discount rate as the dependent variable and various metrics indicating potential firm strengths and weaknesses as the independent variables. Findings This study finds evidence that suggests managers for both groups of firms are using their choice of discount rate to manage bottom-line earnings. These findings highlight the patterns of various firm choice differences found between the two groups and the magnitude of the differences between the groups. Originality/value Three streams of literature are considered in this research: earnings management, defined pension plans and z-score bankruptcy. This study extends prior research by examining the unexpected portion of the pension discount rate based on the z-score determination of whether a firm is considered financially healthy or financially unhealthy. Our findings highlight the impact of various firm choice differences found between the two groups of firms.

Determining corporate direction in sustainable development: a multi-dimensional framework in B2B

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Rocío Rodríguez ◽  
Göran Svensson ◽  
Greg Wood
Keyword(s):  
Sustainable Development ◽  
Healthcare System ◽  
Design Methodology ◽  
Religious Orientation ◽  
Financial Assets ◽  
Healthcare Organizations ◽  
Sustainable Practices ◽  
Content Type ◽  
Business To Business ◽  
Practical Implications

Purpose This study aims to assess the determinants of corporate direction in sustainable development through time in a B2B setting. Design/methodology/approach This study has been conducted in one industry, and overcoming contextual bias as a judgmental sampling was used to select the organizations studied in a Business to Business (B2B) setting. Findings The determinants of sustainable development in this study indicate the existence of different corporate directions in a B2B setting taken through time in the healthcare organizations studied. The determinants found are change in organizational leadership, financial assets of the organization, religious orientation of the organization, organizational connection to the healthcare system, internal values of the organization and top-staff orientation in the organization. Research limitations/implications The empirical findings reported in a B2B setting have disclosed key determinants of corporate direction in sustainable development. Practical implications The determinants provide managerial guidance to assess the corporate direction in a B2B setting taken in the continuing development of sustainable practices in these organizations. Originality/value This study contributes to a multidimensional framework of determinants in a B2B setting to assess the corporate direction taken in sustainable development through time in a B2B setting. The organizational gap between past and present sustainable development provides guidance to assess the corporate direction in B2B taken by an organization into the future.

scholarly journals Automatic enrollment and employer match: an experiment with the choice of pension plans

2020 ◽  
Vol 27 (3) ◽  
pp. 281-299
Author(s):  
Antonio Gualberto Pereira ◽  
Luís Eduardo Afonso
Keyword(s):  
Pension System ◽  
Pension Plan ◽  
The United States ◽  
Pension Plans ◽  
Low Risk ◽  
Control Group ◽  
Retirement Savings ◽  
Defined Contribution ◽  
Content Type ◽  
Treatment Groups

PurposeThe purpose of this study is to identify arrangements of fully funded defined contribution (FF-DC) pension plans associated with the continuity of retirement savings.Design/methodology/approachThe authors adopted an experimental design composed of a control group and two treatment groups. In all groups, individuals made decisions throughout nine periods: five during the working period and four at the postretirement stage. The authors asked participants if they wanted to join a pension plan, and which plan. The authors offered three plans with different risk profiles: plan 1 (high risk), plan 2 (moderate) and plan 3 (low risk) and one risk-free plan, plan 4. In treatment groups 1 and 2, there was an automatic enrollment of the participants in the default plan (moderate risk), and in the following periods they had to decide whether to continue contributing, and in this case, to which plan, with a defined percentage.FindingsIn treatment scenarios, participants chose the riskiest plan in all periods of the experiment, and most of them chose the risk-free plan in period 5. These findings suggest that pension plans with automatic enrollment, employer matching and low risk foster the continuation of retirement savings.Research limitations/implicationsThe research has as limitation the fact that the sample is not representative of the population and therefore does not allow generalizations. This is because the authors use social media ads to prospect respondents.Practical implicationsThe research's findings can be relevant for the design of public policies for private pension plans, suggesting that compulsory automatic enrollment can be used as default in plans offered by the employers. The results encourage the inclusion of behavioral elements in the design of the pension system, paying attention to the nudges. In this sense, it is possible to increase participation in the pension plan and develop low cost programs to increase the amount accumulated by people before retirement.Social implicationsDecision-making architecture, such as automatic enrollment, can improve individuals' retirement decisions, affecting savings and welfare in the long run.Originality/valueAlthough the effect of pension plan designs is widely studied in other countries, such as the United States and United Kingdom, the authors are unaware of a national empirical research that seeks to understand how different arrangements affect an individual choice through an experiment.

scholarly journals Sharīʿah non-compliant assets as rahn (pledge) in Islamic banking products: a fiqhī perspective

2017 ◽  
Vol 9 (2) ◽  
pp. 196-199 ◽  
Author(s):  
Lokmanulhakim Hussain ◽  
Mohammad Mahbubi Ali
Keyword(s):  
Design Methodology ◽  
Document Analysis ◽  
Reference Source ◽  
Islamic Banking ◽  
Financial Assets ◽  
Insurance Policy ◽  
Content Type ◽  
Policies And Procedures ◽  
Islamic Financial Institutions

Purpose The purpose of this study is to present a framework regarding the use of Sharīʿah non-compliant assets as rahn (pledge) and to provide the Sharīʿah analysis on the application of numerous collateral instruments, including financial assets such as shares, unit trusts, current accounts and investment accounts which are Sharīʿah non-compliant. Design/methodology/approach The study adopts a library-based approach to examine the concept and requirements of rahn, deliberate the classification of Sharīʿah non-compliant assets and delineate the Sharīʿah views on the use of Sharīʿah non-compliant assets as pledges. It also examines the various forms of pledge available and offered in the market using document analysis as well as through discussion with industry practitioners. Findings In general, the study concludes that Sharīʿah non-compliant assets, either due to their essence or due to the means of acquisition where there is no ownership from Sharīʿah perspective, cannot be used as rahn. This study also provides the Sharīʿah analysis on the use of modern instruments such as shares, unit trusts, current accounts, investment accounts and insurance policy as pledges. Originality/value The paper provides a reference source for regulators in formulating an appropriate policy and framework on Sharīʿah-compliant collateral; Sharīʿah committees of Islamic financial institutions in arriving at Sharīʿah decisions on collateral; and industry practitioners in establishing internal policies and procedures on collateral.

Economies of scale: the case of KiwiSaver fees

2019 ◽  
Vol 31 (4) ◽  
pp. 695-710
Author(s):  
Aaron Gilbert ◽  
Ayesha Scott ◽  
Shuohan Xu
Keyword(s):  
Mutual Funds ◽  
Design Methodology ◽  
Economies Of Scale ◽  
Cost Savings ◽  
Retirement Savings ◽  
Defined Contribution ◽  
Translog Cost Function ◽  
Content Type ◽  
Cent Increase ◽  
Funds Management

Purpose International evidence of economies of scale in mutual funds is mixed. KiwiSaver offers an interesting opportunity to examine economies of scale given its growth from a new scheme with few members and low balances, where fund costs should be high, to a much larger scheme that should be cheaper to run. As a defined contribution superannuation scheme, fees play an important role in determining the eventual retirement savings members achieve. This paper aims to examine whether the anticipated economies of scale are passed onto members. Design/methodology/approach The authors use a sample of 267 KiwiSaver funds over 2013-2018 and relate fund fees to assets under management (AUM) and the number of participants using regression analysis and a translog cost function. Findings The authors find evidence to suggest funds are passing on cost savings. Specifically, the authors observe that fees increase slower as the number of members grows, suggesting economies of scale are driven by the number of members, but not the size of the assets being managed. All else held constant, a 1 per cent increase in fund participants increases fees by 0.93 per cent on average. In contrast, a 1 per cent increase in AUM results in effectively 1 per cent increase in fees, all else held constant. Originality/value While KiwiSaver has been an undeniable boost to the local funds management industry, regulators are increasingly under pressure to ensure fees are appropriate. In 11 years, New Zealand-based KiwiSaver has grown to over $50b in AUM, with over $400m in total fees per year. This paper provides evidence that economies of scale are partially present in the KiwiSaver sector, although not where it arguably counts: in the size of the AUM.

Surveillance investments in store environment and sense of security

Facilities ◽  
2010 ◽  
Vol 28 (9/10) ◽  
pp. 465-474 ◽  
Author(s):  
Sami Kajalo ◽  
Arto Lindblom
Keyword(s):  
Design Methodology ◽  
Grocery Store ◽  
Internet Survey ◽  
Content Type ◽  
Sense Of Security ◽  
Research Gap ◽  
Store Environment ◽  
Retail Entrepreneurs ◽  
Practical Implications ◽  
High Sense

PurposeThis study aims to focus on how grocery store retail entrepreneurs invest in formal and informal surveillance, and how these investments affect consumers' and employees' sense of security. In particular, it tries to understand what kind of surveillance investments can be found from the stores with high consumer and employees' sense of security.Design/methodology/approachThe present study utilizes elements of CPTED in its theoretical approach. The population for the study consisted of 946 grocery store K‐retailers. The data collection was carried out through an internet survey in February and March of 2009. A total of 161 grocery store retailers filled in the questionnaire, yielding a response rate of 17 percent.FindingsThe research reveals that investments in informal surveillance are more likely to create a high sense of security among consumers and employees than are investments in formal surveillance. In other words, the analysis shows that the stores where consumers and employees have a high sense of security have made more investments in comfortable, clean and well‐lit premises than stores where consumers and employees have a low sense of security.Research limitations/implicationsThe present study was limited to surveillance and to consumers' and employees' sense of security as understood by the retailers. Unquestionably, there is a need to study surveillance from the consumers' and employees' viewpoints. In addition, qualitative studies would enable more thorough operationalization of the concepts that linked the surveillance and sense of security in the store context.Practical implicationsRetailers wishing to create a safe retail space for employees and customers should invest in informal surveillance. Investments in comfortable, well‐cleaned and well‐lighted premises make both consumers and employees feel safe in the store environment. In this way, retailers can enhance the competitiveness of their store.Originality/valueVery little empirical research has evaluated the effectiveness of surveillance in the store environment, although many articles and reports have commented on the importance of surveillance. The present study fills this research gap.

Defined benefit pension decline: the consequences for organizations and employees

2014 ◽  
Vol 36 (6) ◽  
pp. 654-673 ◽  
Author(s):  
Ebony de Thierry ◽  
Helen Lam ◽  
Mark Harcourt ◽  
Matt Flynn ◽  
Geoff Wood
Keyword(s):  
Industrial Relations ◽  
Pension Plans ◽  
Defined Benefit ◽  
Defined Contribution ◽  
Content Type ◽  
Employment Relationships ◽  
Defined Contribution Plans ◽  
Cost Cutting ◽  
Critical Literature

Purpose – The purpose of this paper is to use the theoretical and empirical pension literatures to question whether employers are likely to gain any competitive advantage from degrading or eliminating their employees’ defined benefit (DB) pensions. Design/methodology/approach – Critical literature review, bringing together and synthesizing the industrial relations, economics, social policy, and applied pensions literature. Findings – DB pension plans do deliver a number of potential performance benefits, most notably a decrease in turnover and establishment of longer-term employment relationships. However, benefits are more pronounced in some conditions than others, which are identified. Research limitations/implications – Most of the analysis of pension effects to date focuses primarily on DB plans. Yet, these are declining in significance. In the years ahead, more attention needs to be paid to the potential consequences of defined contribution plans and other types of pension. Practical implications – In re-evaluating DB pensions, firms have tended to focus on savings made through cost cutting. Yet, this approach tends to view a firm's people as an expense rather a potential asset. Attempts to abandon, modify, or otherwise reduce such schemes has the potential to save money in the short term, but the negative long-term consequences may be considerable, even if they are not yet obvious. Originality/value – This paper is topical in that it consolidates existing research evidence from a number of different bodies of literature to make a case for the retention of DB pension plans, when, in many contexts, they are being scaled back or discarded. It raises a number of important issues for reflection by practitioners, and highlights key agendas for future scholarly research.

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