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Innovative Approaches to Managing Longevity Risk in Asia: Lessons from the West

Author

Listed:
  • Roy, Amlan

    (Asian Development Bank Institute)

Abstract

This paper discusses what is longevity risk, why it is important, approaches used by the West to manage longevity risk, and what lessons can be learnt by Asian countries from the experiences of the West. Increasing and uncertain longevity has emerged as a key risk affecting individuals, pension plans, insurers, and governments in both the developed and emerging world. I discuss progress in the field of longevity modeling and the merits as well as drawbacks of these models. In western countries, attempts have been made by capital market and governments to deal with longevity risk, but the availability of solutions remain limited.

Suggested Citation

  • Roy, Amlan, 2012. "Innovative Approaches to Managing Longevity Risk in Asia: Lessons from the West," ADBI Working Papers 353, Asian Development Bank Institute.
    • Handle: RePEc:ris:adbiwp:0353
    as

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    File URL: http://www.adbi.org/files/2012.04.13.wp353.innovative.longevity.risk.asia.pdf
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    References listed on IDEAS

    as
    1. Pablo Antolin, 2007. "Longevity Risk and Private Pensions," Financial Market Trends, OECD Publishing, vol. 2007(1), pages 107-128.
    2. Brown, Jeffrey R. & Mitchell, Olivia S. & Poterba, James M. & Warshawsky, Mark J., 2001. "The Role of Annuity Markets in Financing Retirement," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262529130, December.
    3. Robert W. Fogel, 2005. "Changes in the Physiology of Aging during the Twentieth Century," NBER Working Papers 11233, National Bureau of Economic Research, Inc.
    4. Mackenzie,George A. (Sandy), 2006. "Annuity Markets and Pension Reform," Cambridge Books, Cambridge University Press, number 9780521846325.
    5. Pablo Antolin & Hans J. Blommestein, 2007. "Governments and the Market for Longevity-indexed Bonds," Financial Market Trends, OECD Publishing, vol. 2007(1), pages 153-175.
    6. Pablo Antolin, 2009. "Ageing and the payout phase of pensions, annuities and financial markets," OECD Journal: Financial Market Trends, OECD Publishing, vol. 2008(2), pages 1-19.
    7. David E. Bloom & David Canning & Jaypee Sevilla, 2001. "Economic Growth and the Demographic Transition," NBER Working Papers 8685, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Robert Holzmann, 2013. "Global pension systems and their reform: Worldwide drivers, trends and challenges," International Social Security Review, John Wiley & Sons, vol. 66(2), pages 1-29, April.

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    More about this item

    Keywords

    longevity risk; asia; managing longevity risk; longevity modeling; pension plans;
    All these keywords.

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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