Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/25279
Authors: 
Post, Thomas
Gründl, Helmut
Schmit, Joan
Zimmer, Anja
Year of Publication: 
2008
Series/Report no.: 
SFB 649 discussion paper 2008,037
Abstract: 
Much of the industrialized world is undergoing a significant demographic shift, placing strain on public pension systems. Policymakers are responding with pension system reforms that put more weight on privately managed retirement funds. One concern with these changes is the effect on individual welfare if individuals invest suboptimally. Using micro-level data from the United States and Germany, we compare the optimal expected lifetime utility computed using a realistically calibrated model with the actual utility as reflected in empirical asset allocation choices. Through this analysis, we are able to identify the population subgroups with relatively large welfare losses. Our results should be helpful to public policymakers in designing programs to improve the performance of privately organized retirement systems.
Subjects: 
Asset allocation
retirement welfare
pension reform
JEL: 
D14
D91
G11
G28
I31
Document Type: 
Working Paper

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