Informality and the Challenge of Pension Adequacy: Outlook and Reform Options for Peru

2019 ◽  
Author(s):  
Christoph Freudenberg ◽  
Frederik Toscani
Keyword(s):  
Pension Adequacy

scholarly journals Enhancing Pension Adequacy While Reducing the Fiscal Budget and Creating Essential Capital for Domestic Investments and Growth: Analysing the Risks and Outcomes in the Case of Greece

Risks ◽  
2020 ◽  
Vol 9 (1) ◽  
pp. 8
Author(s):  
Georgios Symeonidis ◽  
Platon Tinios ◽  
Panos Xenos
Keyword(s):  
The State ◽  
Replacement Rate ◽  
Pension Systems ◽  
Expected Result ◽  
Financial Pressure ◽  
The World ◽  
Domestic Investments ◽  
Of Greece ◽  
Pension Adequacy

Many countries around the world are resorting to mandatory funded components in their multi-pillar pension systems with the purpose of catering for the financial pressure from ageing. This paper aims at analysing the possible replacement rates for such a scheme, by choosing different assumptions and setting the best combined area for the expected result. Then, an approach for analysing the potential for the implementation of such a scheme in Greece is presented along with the actuarially projected expected benefit expenditure and respective accrued capital. A result of the introduction of such a component is expected to be the elevated replacement rate at retirement with a concurrent alleviation of the fiscal burden for the state. The projected scale of savings will also provide domestic financing for investments generating growth.

GUARANTEE VALUATION IN NOTIONAL DEFINED CONTRIBUTION PENSION SYSTEMS

2016 ◽  
Vol 46 (3) ◽  
pp. 677-707 ◽  
Author(s):  
Jennifer Alonso-García ◽  
Pierre Devolder
Keyword(s):  
Interest Rates ◽  
Closed Form Solution ◽  
Form Solution ◽  
Pension Scheme ◽  
Dependence Structure ◽  
Defined Contribution ◽  
Index Set ◽  
Notional Defined Contribution ◽  
Utility Indifference ◽  
Pension Adequacy

AbstractThe notional defined contribution pension scheme combines pay-as-you-go financing and a defined contribution pension formula. The return on contributions is based on an index set by law, such as the growth rate of GDP, average wages or contribution payments. The volatility of this return compromises the system's pension adequacy and therefore guarantees may be needed. Here, we provide a minimum return guarantee to the pension contributions. The price is calculated in a utility indifference framework. We obtain a closed-form solution for a general dependence structure with exponential preferences and in presence of stochastic short interest rates.

scholarly journals Informality and the Challenge of Pension Adequacy

2019 ◽  
Vol 19 (149) ◽  
pp. 1
Author(s):  
Christoph Freudenberg ◽  
Frederik Toscani
Keyword(s):  
Pension System ◽  
Pension Reform ◽  
Positive Impact ◽  
Defined Benefit ◽  
Defined Contribution ◽  
Real Rate ◽  
Labor Market Reform ◽  
The Impact ◽  
Term Labor ◽  
Pension Adequacy

Past reforms have put the Peruvian pension system on a largely fiscally sustainable path, but the system faces important challenges in providing adequate pension levels for a large share of the population. Using administrative microdata at the affiliate level, we project replacement rates in the defined benefit (DB) and defined contribution (DC) pillars over the next 30 years and simulate the impact of various reform scenarios on the average level and distribution of pensions. In the DB pillar, the regressive minimum contribution period should be re-thought, while in the DC pillar a broadening of the contribution base and/or an increase in contribution rates would help increase replacement rates relative to the baseline forecast of 25-33 percent. A higher net real rate of return than assumed in the baseline would also have a significant positive impact. In the medium-term, labor market reform to tackle informality, and a broad pension reform to restructure the system and avoid competition between the DB and DC pillars should be a priority. Given low pension coverage, having a strong non-contributory pillar will remain important for the foreseeable future.

scholarly journals The problematic nature of UK pension fund regulation: Performing governance at the expense of innovation

2020 ◽  
pp. 102452942097460
Author(s):  
Gordon L. Clark
Keyword(s):  
Financial Services ◽  
Pension Fund ◽  
Best Interests ◽  
Defined Benefit ◽  
Defined Contribution ◽  
Dead End ◽  
Fit For Purpose ◽  
Board Decision Making ◽  
The Uk ◽  
Pension Adequacy

At the heart of UK pension fund regulation are quasi-compulsory codes of practices and tests of pension fund trustees’ competence. This regime of ‘soft’ regulation focuses upon the ‘performance’ of governance and is intrusive in terms of expected behaviour and board decision-making. Framed by defined benefit pension obligations in the private sector, it lacks rigorous standards of value when applied to defined contribution pensions. As such, pension ‘adequacy’ is discounted by the premium placed on performing governance in the market for financial services. The UK pension regime has hit a dead-end being neither fit-for-purpose in a world of technological disruption and financial turmoil nor capable of empowering those funds willing and able to innovate in the best interests of participants.

scholarly journals POLICY AND ECONOMIC INFLUENCES ON RETIREMENT, FINANCIAL LITERACY, AND ECONOMIC SECURITY IN JAMAICA

2019 ◽  
Vol 3 (Supplement_1) ◽  
pp. S580-S580
Author(s):  
Julian G McKoy Davis
Keyword(s):  
Financial Literacy ◽  
Planning Process ◽  
Pension Reform ◽  
Economic Security ◽  
Population Ageing ◽  
Longevity Risk ◽  
Risky Investment ◽  
Pension Coverage ◽  
Low Levels ◽  
Pension Adequacy

Abstract The changing pension landscape, as well as the accompanying privatization, marketization and individualization of the pension planning process, has resulted in inadequate and risky investment practices. Jamaica, like many other countries in the international community, has been engaged in pension reform. The main issues in the current dispensation of pension reform are in relation to pension adequacy to mitigate against longevity risk, low levels of pension coverage; with the aforementioned leading to the need to increase the number of persons contributing to the pension pool as well as possibly an increase in the value of pension contributions to account for inflation and investment risks. This paper describes the current legal and regulatory framework on pension reform in Jamaica within the context of population ageing and the National Financial Inclusion Strategy that targets persons who were previously underserved by the domestic financial system. Policy and programmatic recommendations are will be provided.

From the Replacement Rate to the Synthetic Indicator: A Global and Gender Measure of Pension Adequacy in the European Union

2017 ◽  
Vol 138 (1) ◽  
pp. 165-186 ◽  
Author(s):  
Juan-José Alonso-Fernandez ◽  
Robert Meneu-Gaya ◽  
Enrique Devesa-Carpio ◽  
Mar Devesa-Carpio ◽  
Inmaculada Dominguez-Fabian ◽  
...  
Keyword(s):  
European Union ◽  
The European Union ◽  
Replacement Rate ◽  
Synthetic Indicator ◽  
And Gender ◽  
Pension Adequacy

scholarly journals The Replacement Rate: An Imperfect Indicator of Pension Adequacy in Cross-Country Analyses

2015 ◽  
Vol 126 (1) ◽  
pp. 99-117 ◽  
Author(s):  
Filip Chybalski ◽  
Edyta Marcinkiewicz
Keyword(s):  
Replacement Rate ◽  
Cross Country ◽  
Pension Adequacy
Sign in / Sign up

Export Citation Format

Share Document