Designing Benefit Rules for Flexible Retirement with or without Redistribution
AbstractThe traditional approach to flexible retirement (e.g. NDC) neglects the impact of asymmetric information on actuarial fairness (neutrality). The mechanism design approach (e.g. Diamond, 2003) gives up the requirement of neutrality and looks for a redistributive second-best benefit-retirement-age schedule. Trying to combine the two approaches, the present paper determines the neutral (redistribution-free) second-best solution. This neutral solution is, however, often Pareto-dominated by the redistributive one.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 1370.
Date of creation: 2004
Date of revision:
flexible retirement; asymmetric information; actuarial fairness (neutrality); mechanism design;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-01-16 (All new papers)
- NEP-MIC-2005-01-16 (Microeconomics)
- NEP-PBE-2005-01-16 (Public 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.:
- Eytan Sheshinski, 2002.
"Optimum Delayed Retirement Credit,"
Discussion Paper Series
dp329, The Center for the Study of Rationality, Hebrew University, Jerusalem.
- Valdes-Prieto, Salvador, 2000. " The Financial Stability of Notional Account Pensions," Scandinavian Journal of Economics, Wiley Blackwell, vol. 102(3), pages 395-417, June.
- Courtney Coile & Jonathan Gruber, 2000. "Social Security and Retirement," NBER Working Papers 7830, National Bureau of Economic Research, Inc.
- P. A. Diamond & J. A. Mirrlees, 1977.
"A Model of Social Insurance With Variable Retirement,"
210, Massachusetts Institute of Technology (MIT), Department of Economics.
- Diamond, P. A. & Mirrlees, J. A., 1978. "A model of social insurance with variable retirement," Journal of Public Economics, Elsevier, vol. 10(3), pages 295-336, December.
- Mirrlees, James A, 1971. "An Exploration in the Theory of Optimum Income Taxation," Review of Economic Studies, Wiley Blackwell, vol. 38(114), pages 175-208, April.
- Rothschild, Michael & Stiglitz, Joseph E, 1976. "Equilibrium in Competitive Insurance Markets: An Essay on the Economics of Imperfect Information," The Quarterly Journal of Economics, MIT Press, vol. 90(4), pages 630-49, November.
- Peter Diamond, 2004. "Social Security," American Economic Review, American Economic Association, vol. 94(1), pages 1-24, March.
- J. A. Mirrlees & P. Diamond, 1982. "Social Insurance with Variable Retirement and Private Saving," Working papers 296, Massachusetts Institute of Technology (MIT), Department of Economics.
- Peter Eso & Andras Siminovits, 2002. "Designing Optimal Benefit Rules for Flexible Retirement," Discussion Papers 1353, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Smith, V. Kerry & Taylor, Donald H., Jr. & Sloan, Frank A., 2000.
"Longevity Expectations and Death: Can People Predict Their Own Demise?,"
00-15, Duke University, Department of Economics.
- V. Kerry Smith & Donald H. Taylor & Frank A. Sloan, 2001. "Longevity Expectations and Death: Can People Predict Their Own Demise?," American Economic Review, American Economic Association, vol. 91(4), pages 1126-1134, September.
- Simonovits, Andr S, 2003. "Designing optimal linear rules for flexible retirement," Journal of Pension Economics and Finance, Cambridge University Press, vol. 2(03), pages 273-293, November.
- Heidler, Matthias & Raffelhüschen, Bernd & Leifels, Arne, 2006. "Heterogenous life expectancy, adverse selection, and retirement behaviour," FZG Discussion Papers 13, Research Center for Generational Contracts (FZG), University of Freiburg.
- András Simonovits, 2006. "Optimal Design of Pension Rule with Flexible Retirement: The Two-Type Case," Journal of Economics, Springer, vol. 89(3), pages 197-222, December.
- Andras Simonovits, 2013. "Regressive intracohort redistribution in nonfinancial defined contribution pension," IEHAS Discussion Papers 1312, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
- Juan A. Lacomba & Francisco M. Lagos, 2009. "Reforming the retirement scheme: Flexible retirement vs. Legal retirement age," ThE Papers 09/01, Department of Economic Theory and Economic History of the University of Granada..
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julio Saavedra).
If references are entirely missing, you can add them using this form.