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The Case for Gender-Sensitive Superannuation Plan Design

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  • Anup K. Basu
  • Michael E. Drew

Abstract

"A key feature of superannuation plan design is the assumption that members have long and continuous periods of employment over which contributions are made. This heroic design feature has led to debate on the adequacy of superannuation plans for those with interrupted employment, particularly the adverse impacts this has on the retirement income prospects of women. This paper employs non-parametric stochastic simulation to investigate two possible solutions to gender inequality in superannuation, higher contribution rates and more aggressive asset allocation. Our results suggest that while both these strategies in isolation are effective in reducing the current gender disparity in superannuation outcomes, they demand significant changes to current arrangements when employed individually to address the problem. A combined approach is found to be more powerful in ensuring a more equitable superannuation outcome for women, as it nullifies the relative disadvantage of interrupted employment with only modest changes to contribution rates and asset allocation." Copyright (c)2009 The University of Melbourne, Melbourne Institute of Applied Economic and Social Research.
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Suggested Citation

  • Anup K. Basu & Michael E. Drew, 2009. "The Case for Gender-Sensitive Superannuation Plan Design," Discussion Papers in Finance finance:200904, Griffith University, Department of Accounting, Finance and Economics.
  • Handle: RePEc:gri:fpaper:finance:200904
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    File URL: https://www120.secure.griffith.edu.au/research/items/fd095a2b-bebe-780c-ee28-1f9701a0c9cb/1/2009-04-case-for-gender-sensitive-superannuation-plan-design.pdf
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    References listed on IDEAS

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    Cited by:

    1. Wei-Ting Pan, 2016. "The Impact of Mandatory Savings on Life Cycle Consumption and Portfolio Choice," PhD Thesis, Finance Discipline Group, UTS Business School, University of Technology, Sydney, number 32.

    More about this item

    Keywords

    Superannuation; Gender;

    JEL classification:

    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies

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