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Annuity Values in Defined Contribution Retirement Systems: Australia and Singapore Compared

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Author Info
Suzanne Doyle
Olivia S. Mitchell
John Piggott

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Abstract

Annuities promise to play an increasingly important role in countries with national defined contribution retirement systems. In this article we examine life annuities in two countries, Singapore and Australia, each of which has a national mandatory pension program. Exploiting data on annuity pricing and purchase behaviour, we compare the money's worth of life annuity products across these two nations. Our results indicate that, after controlling on administrative loadings, there are important differences in measured adverse selection. Part of the explanation may be due to the different structures of the two countries'retirement systems. Copyright 2004 The University of Melbourne, Melbourne Institute of Applied Economic and Social Research.

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Article provided by The University of Melbourne, Melbourne Institute of Applied Economic and Social Research in its journal The Australian Economic Review.

Volume (Year): 37 (2004)
Issue (Month): 4 (December)
Pages: 402-416
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Handle: RePEc:bla:ausecr:v:37:y:2004:i:4:p:402-416

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  1. Hazel Bateman & Susan Thorp, 2007. "Choices and constraints over retirement income streams: comparing rules and regulations," Discussion Papers 2007-29, School of Economics, The University of New South Wales. [Downloadable!]
    Other versions:
  2. Kam Ki Tang & Jie Zhang, 2007. "Morbidity, Mortality, Health Expenditures and Annuitization," CESifo Working Paper Series CESifo Working Paper No. , CESifo GmbH. [Downloadable!]
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