Pension Plan Choice in the Public Sector: The Case of Michigan State Employees
AbstractIn 1997, the State of Michigan closed its DB pension plan to new state employees. New employees are automatically enrolled in a 401(k) plan with a mandatory state contribution. Existing employees chose between staying in the DB plan, or transferring the present value of their vested pension benefits to a DC plan. This paper surveys the event and analyzes the choice made by corrections workers, about 25 percent of Michigan public employment. An analysis of the switch to individual accounts may inform Federal estimates of take–up rates in a possible privatization of Social Security.
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Bibliographic InfoArticle provided by National Tax Association in its journal National Tax Journal.
Volume (Year): 57 (2004)
Issue (Month): 2 (June)
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- Robert L. Clark & Melinda S. Morrill & David Vanderweide, 2012. "Defined Benefit Pension Plan Distribution Decisions by Public Sector Employees," NBER Working Papers 18488, National Bureau of Economic Research, Inc.
- Jeffrey R. Brown & Scott J. Weisbenner, 2007.
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NBER Working Papers
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- Shlomo Benartzi & Richard Thaler, 2007. "Heuristics and Biases in Retirement Savings Behavior," Journal of Economic Perspectives, American Economic Association, vol. 21(3), pages 81-104, Summer.
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