The Rationale for Occupational Pensions

Employers and employees have no incentive to include pensionsas part of employment contracts unless the pension completesa missing market, or ameliorates an imperfection in existingcapital or labour markets. We examine the influence on the choiceand design of occupational pensions of capital- and labour-marketimperfections. In capital markets, we focus on basis risks,taxation, employer default risks, transactions costs, portfoliorestrictions, and liquidity constraints. Aspects of labour marketsaffecting occupational pensions may be the presence of firm-specifichuman capital, asymmetric information between firms and potentialhires, the presence of moral hazard, and internal labour marketsin firms which cause employers to attempt to control the retirementbehaviour of workers. The implications of this analysis of occupationalpensions for public policy towards pensions are briefly examined. Footnotes ¹ E-mail address: dg.mccarthy{at}imperial.ac.uk     

Taxes and Pensions

Pension benefit rules depend on individual history far more than taxes do, and age plays a much larger role in pension determination than in tax determination. Apart from some simulation studies, theoretical studies of optimal tax design typically contain neither a mandatory pension system nor the behavioral dimensions that lie behind justifications commonly offered for mandatory pensions. Conversely, optimizing models of pension design typically do not include annual taxation of labor and capital incomes. After spelling out this contrast and reviewing (and rejecting) zero taxation of capital income based on the Atkinson‐Stiglitz and Chamley‐Judd results, this article raises the issue of tax‐favored retirement savings, a topic where the two subjects come together.     

Mandatory Pensions and Personal Savings in The Netherlands*

The Netherlands has a relatively generous social security system and a wide coverage of individuals by private (occupational) pension schemes. Total household savings are rather high and fairly stable, although the amount of contractual savings apears to be going up at the expense of non-contractual (free) savings. Using an approach originally pioneered by Feldstein (1974) we employ microdata to investigate the displacement effect of security and pension wealth on free household savings. It turns out that the data available are too noisy to make precise statements about the displacement effects. Our results do suggest, however, that a one-for-one displacement of free savings by social security is consistent with the data. For pensions such a complete offset is less likely. This suggests that increase of coverage by private pensions is an effective way of raising savings.     

Measuring Lifetime Redistribution in Dutch Occupational Pensions

Summary  This paper assesses how the Dutch system of occupational pensions redistributes between and within generations. The approach in this paper deviates from the usual approach by incorporating the full life cycle in the measurements, rather than only the annual effects. In order to quantify redistribution, we use the level of educational attainment, gender and age to classify the pension fund population. For all groups distinguished, we measure in present value terms the average net benefit from participating in occupational pensions. The results indicate a sizable redistribution from males to females and from low educated to higher educated workers. On a lifetime basis, the impact of intergenerational transfers is modest. I am grateful to the two anonymous referees, Ed Westerhout, Casper van Ewijk, Lex Meijdam, Yvonne Adema and Peter Kooiman for their helpful comments on earlier drafts of this paper, and to Andre Nibbelink for his valuable computational assistance.     

Redesigning Regulation of Pensions and Other Financial Products

We observe that financial regulation is ever-growing, with thelatest area to experience increased supervisory attention beingpensions. Yet this has not made the financial world or consumerssafer, and for pensions in particular there are unexpected andundesired consequences. We explore the current policy approachto supervision, which is ‘bottom up’, i.e. assessmentand regulation of individual institutions, with the aim ofmakingthe financial system safe by making each institution safe. Weshow that this is both damaging (because it stifles innovation)and does not work (because risk will always be squeezed fromthe regulated institutions to the less regulated and less seen).Instead, we advocate a ‘top-down’ approach, whichfocuses on making the system safe first. We conclude that onceyou have made systems safe, detailed supervision of individualinstitutions is less necessary, thus reducing the burden ofsupervision. We believe that this approach will lead to a moresuitable and diverse treatment of different risks that willincrease both systemic and consumer safety. ‘If you haveten thousand regulations you destroy all respect for the law’,Winston Churchill (1931). ‘The ultimate result of shieldingmen from the effects of folly is to fill the world with fools’,Herbert Spencer (1891). Footnotes ¹ E-mail addresses: n.barr{at}lse.ac.uk; john_nugee{at}ssga.com     

现行经济学学科设置问题与法律经济学的兴起

通过比较国内外现行经济学学科设置,评述法律经济学的学科定位、学科特征与发展趋势,分析政治经济学、制度经济学与法律经济学的关系,发现在应用经济学一级学科目录下,增设法律经济学这一内容丰富、方兴未艾的金矿学科,已经水到渠成。     

The Economics of Transmigrant Farming

The basic agronomy of government-sponsored transmigration areas in Indonesia's Outer Islands has often not been well understood. The soils are commonly fragile podzolie soils which quickly break down once the forest is removed leaving low levels of nutrients. Farmer experience in these areas suggests that the requirements of high fertihser and high labour inputs and the lack of adequate transportation and marketing infrastructure make a continuous food cropping strategy difficult to adopt. From the standpoint of soils management, input requirements and operator time costs per hectare, perennial crops, peanuts and livestock offer the best returns.     

Pensions and Retirement Among Black Union Army Veterans

I examine the effects of an unearned income transfer on the retirement rates and living arrangements of black Union Army veterans. I find that blacks were more than twice as responsive as whites to income transfers in their retirement decisions and 6 to 8 times as responsive in their choice of independent living arrangements. My findings have implications for understanding racial differences in rates of retirement and independent living at the beginning of the twentieth century, the rise in retirement prior to 1930, and the subsequent convergence in black-white retirement rates and living arrangements.     

完善企业年金监管的几点思考

由美国次贷危机引发的全球金融风波至今已近四年,其造成的损失和影响自20世纪30年代以来前所未有.美国、英国和欧盟为防止危机对经济的进一步拖累,纷纷提出自己的金融监管改革计划,以应对危机.文章首先介绍了美国和欧盟金融监管改革的发展历程,然后总结了美欧金融监管改革对我国加强金融监管的启示,最后结合国际金融监管改革的新动向,并从市场化、风险控制和构建合作机制等三方面提出了改善我国企业年金监管的政策建议.     

The Assessment: The Economics of Sport

The study of sports economics has expanded rapidly in recentyears in response to significantly increased demand–forsport itself, for economic analysis relevant to commercial litigationin sport, for lively teaching material in schools and universities,and for research into the incentive properties of sporting contests.While much of the literature has focused on the issue of competitivebalance and how to achieve it, there have still been relativelyfew studies that apply the lessons of the economic theory ofcontests to the analysis of sports. There remain huge opportunitiesboth to develop our theoretical understanding of incentive mechanismsin sport and to conduct empirical research in the operationof incentives in sporting contests.