Public Sector Pension Funds in Australia: Longevity Selection and Liabilities
AbstractThis paper assesses the cost and risk faced by public sector, defined benefit plan providers arising from uncertain mortality, including longevity selection, mortality improvements, and unexpected systematic shocks. Using longitudinal micro data on Australian pensioners, we quantify the extent of longevity selection at both aggregate and scheme level. We also show that as the age-membership structure in a pension scheme matures, scheme-specific longevity selection risk and systematic shocks become quantitatively more important and have larger consequences for plan liabilities than aggregate selection risk or the impact of mortality improvements.
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Bibliographic InfoPaper provided by ARC Centre of Excellence in Population Ageing Research (CEPAR), Australian School of Business, University of New South Wales in its series Working Papers with number 201217.
Length: 44 pages
Date of creation: May 2012
Date of revision:
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This paper has been announced in the following NEP Reports:
- NEP-AGE-2012-06-25 (Economics of Ageing)
- NEP-ALL-2012-06-25 (All new papers)
- NEP-LAB-2012-06-25 (Labour Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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