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Developments in pension reform: the case of Dutch stand-alone collective pension schemes

Author

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  • Lans Bovenberg

    ()

  • Theo Nijman

    ()

Abstract

Corporate defined-benefit plans suffer from a number of serious weaknesses, including credit risk of the sponsor, ambiguous ownership of the surplus and back-loading of benefits. Also defined-contribution plans feature drawbacks. Individuals are not well equipped to make the complex financial decisions involved, transaction costs are substantial and various risks are not managed properly over the life cycle. Stand-alone collective pension schemes offer an attractive third way between corporate defined-benefit schemes and individual defined-contribution schemes. The members of the fund are the risk bearers and the funds manage risk aimed at providing an adequate income level during retirement at low costs. Dutch pension funds are evolving into such stand-alone pension schemes. Some directions for future reforms are sketched. Copyright The Author(s) 2009

Suggested Citation

  • Lans Bovenberg & Theo Nijman, 2009. "Developments in pension reform: the case of Dutch stand-alone collective pension schemes," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 16(4), pages 443-467, August.
  • Handle: RePEc:kap:itaxpf:v:16:y:2009:i:4:p:443-467
    DOI: 10.1007/s10797-009-9108-1
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    References listed on IDEAS

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    Cited by:

    1. Consiglio, Andrea & Tumminello, Michele & Zenios, Stavros A., 2015. "Designing and pricing guarantee options in defined contribution pension plans," Insurance: Mathematics and Economics, Elsevier, vol. 65(C), pages 267-279.
    2. repec:dau:papers:123456789/13624 is not listed on IDEAS

    More about this item

    Keywords

    Stand-alone pension schemes; Netherlands; Risk; J32; J10; J40; J24;

    JEL classification:

    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General
    • J40 - Labor and Demographic Economics - - Particular Labor Markets - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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