Helping tomorrow's retirees manage "distribution phase" risks

Much of employers' attention has focused on helping employees manage the accumulation of 401(k) plan assets rather than on helping them manage the distribution phase--the period during which employees begin drawing down their 401(k) savings to meet their retirement needs. Assisting employees in managing the distribution phase can play an important role in helping employers meet a range of workforce planning goals and ensuring a maximum return on the retirement dollars that have been invested by both employees and the company. By implementing a properly structured approach to help employees manage the distribution phase, employers can help them maximize the value of their retirement savings at little or no employer cost, thanks to the leverage of the company's group purchasing power and the tax advantages of employer-sponsored plans.     

The London Business School with Gower Publishing

The world economy is just starting to emerge from the second trough of a "W-shaped" recession. Compared with the experience after the first oil shock, when industrial production fell by 12 per cent, bringing inflation quickly down from 14 per cent into single figures. the 1980 world recession was mild. Between the first and third quarters industrial output fell 5 per cent; it recovered in the fourth quarter and inflation stopped falling. As a result governments - and this is especially true of the United States - look "another bite at the cherry": monetary policy was tightened and interest rates rose. The effect over the last six months has been to produce a second dip in output. The renewed attack on inflation has, however, been successful and inflation is now well in single figures and falling. Consequently a general easing of policy is evident and a recovery of output in the second half of 1982 and into 1983 remains our forecast.     

LOWER OIL PRICES AND THE UK ECONOMY

Demand for oil remains weak, and OPEC production is running ahead of quota in most member countries, so the possibility that oil prices could fall in the near future has increased. In this Forecast Release we examine the medium-term impact on the UK economy of lower oil prices. We find that, if the government does not intervene to protect the exchange rate, there is an immediate stimulus to output growth. The inflation rate, though, is 1–2 percentage points higher after three years.     

WORLD OUTLOOK

The world recovery, now three years old, has proved more resilient than many expected and will be sustained in 1986 by lower oil prices. Fears that the early-1985 slowdown would turn into renewed recession have proved unfounded, as output in both the United States and Europe picked up in the second half of the year. The improvement stemmed from lower interest rates, falling inflation and weak commodity prices and was further helped by the sharp correction to the value of the dollar following September's G5 agreement. To these factors, which will remain supportive this year, is now added a lower oil price. The recovery in world output has not produced an increase in oil demand and, as the oil price rise of 1979-80 gave a further boost to supply from non-OPEC sources, a severe imbalance has emerged in the oil market. To maintain a £26 marker price (itself cut from £29 last July) has required a cutback in production of ever-increasing magnitude from Saudi Arabia in its role as OPEC's swing producer. Now that Saudi Arabia has abandoned this role in favour of stabilising its market share, oil prices have fallen sharply. We assume that the oil price will fall to £20 by the end of this year, a fall in real terms of 30 per cent. As a result the world recovery is given renewed impetus and output accelerates over the next twelve months. A cyclical peak in activity emerges in 1987, after which output growth settles at 2%-3 per cent and inflation at 4–5 per cent.     

Gendered cognitions: a socio-cognitive model of how gender affects entrepreneurial preferences

ABSTRACT

This research explores the social-cognitive factors which lead both women and men to pursue ventures consistent with their gendered social identity, therefore, reinforcing the gender gap in entrepreneurship. We measured the self-assessments of individuals presented with experimentally manipulated entrepreneurial opportunities that were either consistent or inconsistent with their self-reported gender. A theoretical model derived from Social Role Theory is presented and tested. It posits that a gender match (mismatch) with the entrepreneurial opportunity results in higher (lower) reported self-efficacy, anticipated social resources, and venture desirability and lower (higher) venture risk perceptions. The experimental data are tested in a sequential mediation SEM model. We find evidence that self-efficacy and anticipated social resources mediate the effect of gender congruency on perceived risk and venture desirability. The results provide insight into the insidious barriers that play a role in reproducing a gender gap in entrepreneurial outcomes by ‘nudging’ women into lower-return ventures in less lucrative industries.     

Political competition in a model of economic growth: Some theoretical results

Summary We analyze the role of political competition on the type of economic policies that are selected in a one sector model of economic growth. We identify conditions under which neoclassical optimal growth plans occur, and conditions in which political business cycles occur. We find that the ability commit to multiperiod economic policy leads to less political stability of economic plans.Support for this research was provided in part by NSF grant #SES-9022932 to the California Institute of Technology. We are grateful to a referee for pointing out that our results could be extended to supra majority rules, as in Proposition 1.     

From unemployment to rapid growth?

With unemployment in the OECD countries approaching 30 millions, and with the Mitterrand regime providing yet another example of the failure of demand-led attempts at growth, this article considers the possibility of the advanced industrialised countries returning to a pattern of rapid growth based on plentiful labour supplies. If Keynesian measures to combat high unemployment are rejected, will redundant labour eventually find its own demand, and will this allow a new wave of fast industrial expansion?     

A multistage game representation of sophisticated voting for binary procedures

Farquharson [5] was instrumental in creating the concept of sophisticated voting, in which voters are assumed to successively eliminate dominated strategies. However, his “matrix reduction” procedure is so cumbersome that little use has been made of his insights. Here we define, for binary procedures, a multistage method of sophisticated voting which is easy to apply and intuitively understandable. Our approach allows us to prove that if a majority alternative exists, sophisticated voting leads to an outcome at least as good as and sometimes preferred to the outcome of sincere voting. Our approach yields different sophisticated strategies than Farquharson's method, but we conjecture that both approaches always yield the same outcome.