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The Funding Status of Teacher Pensions: An Econometric Approach

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  • Robert P. Inman

Abstract

The financing of public employee pensions has become an issue of growing public concern. This paper examines the fundinq status of teacher pension plans for the fifty states and for selected localities for the decade, 1971-1980. A pension underfunding equation based upon actuarial principles is specified and estimated using a sample of pension plans for which actuarially sound measures of underfundings are available. The ecometrically-estimated pension equationis then used to "predict" underfundings for each state and local pension plan for each year for which full pension plan data are available. The results reveal that the real dollar value of plan underfundings has risen by over 50% in the average state from 1971-1980. Strategies for funding these growing pension deficits are required.

Suggested Citation

  • Robert P. Inman, 1985. "The Funding Status of Teacher Pensions: An Econometric Approach," NBER Working Papers 1727, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:1727
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    Cited by:

    1. Mitchell, Olivia S & Smith, Robert S, 1994. "Pension Funding in the Public Sector," The Review of Economics and Statistics, MIT Press, vol. 76(2), pages 278-290, May.
    2. Boskin, Michael J. & Robinson, Marc S. & Huber, Alan M., 1987. "Government Saving, Capital Formation and Wealth in the United States, 1947-1985," CEPR Publications 244416, Stanford University, Center for Economic Policy Research.

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