The Welfare Effects of Trade With Labour Market Risk

This paper explores the introduction of collective risk-reallocation elements into defined-contribution pension contracts. We consider status-contingent, age-contingent, and asset-contingent arrangements to reallocate risk among participants. Eliminating asset market risk for the retired raises their welfare, whereas it lowers the welfare of the workers, despite the fact that they benefit later from the same arrangement. Overall welfare falls. The welfare effects are largest when personal and pension portfolios are optimally chosen. Allowing for intragenerational heterogeneity, the highest-skilled retirees benefit most, whereas the highest-skilled workers lose most. Our main results are qualitatively robust to a number of model variations and extensions.

Labour market risk and the regions

Geographies of Labour Market Inequality ◽

10.4324/9780203222812_chapter_2 ◽

2010 ◽

pp. 23-54 ◽

Cited By ~ 3

Author(s):

Philip S Morrison ◽

Olga Berezovsky

Keyword(s):

Labour Market ◽

Market Risk

Labour Market Risk Shifts in 18 Post-industrial Economies: An Application of Fuzzy-set Ideal Type Approach

Korea Social Policy Review ◽

10.17000/kspr.20.3.201309.47 ◽

2013 ◽

Vol 20 (3) ◽

pp. 47-76

Author(s):

Seung-yoon Sophia Lee

Keyword(s):

Labour Market ◽

Fuzzy Set ◽

Market Risk ◽

Ideal Type ◽

Post Industrial

The unemployment and welfare effects of labour market policy: a comparison of the USA and the UK

Unemployment Policy ◽

10.1017/cbo9780511752025.041 ◽

1997 ◽

pp. 545-572 ◽

Cited By ~ 30

Author(s):

Stephen P. Millard ◽

Dale T. Mortensen

Keyword(s):

Labour Market ◽

Welfare Effects ◽

Labour Market Policy ◽

Market Policy ◽

The Usa ◽

The Uk