The Pension Research Council of The Wharton School of the University of Pennsylvania is committed to generating debate on key policy issues affecting pensions and other employee benefits. We sponsor interdisciplinary research on the entire range of private pension and social security programs, as well as related benefit plans in the United States and around the world.
PublicationBenefits and Productivity(2001-10-01) Even, William E; Macpherson, David A PublicationAdult Learning Principles and Pension Participant Behavior(2003-01-01) Saliterman, Victor; Sheckley, Barry GMost efforts to influence participants in workplace-based retirement plans to take full advantage of investment benefits available to them have limited impact. Despite years of educational initiatives, retirement saving for most Americans remains inadequate. Our study suggests that participants who receive information about their retirement savings in accord with research-based principles of how adults learn best, will markedly increase contributions to their retirement plans. Educational activities that are learner-centered guide participants through a re-cognition of how they can use information about investment options to devise effective financial plans. Activities that engage participants as active, self-determining individuals who will benefit from assistance that helps them to reflect upon, make informed choices about, and take control of their retirement saving plans. PublicationAnnuity Markets in Japan(2010-09-01) Sakamoto, JunichiIn Japan, annuities are not currently very popular as a means to finance retirement, since many people rely on government social security benefits in old age. When annuities are sold, they tend not to be life payouts but rather term-certain products. In this sense, the annuity puzzle also applies to Japan. We discuss possible reasons for the unpopularity of annuity products, including costs and inequitable taxation that hinders people from buying them. PublicationGovernance and Investments of Public Pensions(1999) Useem, Michael; Hess, David PublicationDetermining the Cost of Public Pension Plans(1999) Hustead, Edwin C PublicationHousehold Debt and Aging in Japan(2019-05-02) Horioka, Charles Yuji; Niimi, YokoIn this paper, we analyze the borrowing behavior of Japanese households in comparison to the other Group of Seven (G7) countries and also broken down by the age group of the household head. We find that pre-retirement households (households with a head in the 50-59 age group) in Japan do not have inordinate amounts of debt and that their financial health is satisfactory. However, we also find that households with a head in the 30-39 age group have shown a sharp increase in debt holdings in recent years, due partly to the fact that tax breaks for housing purchase, reforms in the housing loan market since the early 2000s, and expansionary monetary policy enabled Japanese households to purchase housing at a younger age than they could previously. We therefore need to monitor the borrowing behavior of this cohort over time as the Bank of Japan normalizes its monetary policy, especially since households have become more vulnerable to rising interest rates as the share of households who have chosen variable-rate housing loans has increased in recent years. PublicationThe United States Longevity Insurance Market(2010-09-01) Webb, AnthonyThis chapter documents the substantial decline in traditional sources of longevity insurance, and shows that published statistics on the individual annuity market greatly overstate its size and growth. It considers whether the decline in annuitization rates is cause for concern. It then documents in more detail the structure, size, and pricing of the individual annuity market, and discusses product innovations. It concludes by discussing policy options for increasing rates of voluntary annuitization. PublicationPaying It Back: Real-world Debt Service Trends and Implications for Retirement Planning(2019-05-02) Lester, Anne; Santiago, Katherine; Oh, Je; Wu, Livia; Chegaeva, EkaterinaThis research uses a unique data set to answer some fundamental questions that have not previously been fully addressed. Specifically, it provides a summary of the debt service patterns of United States consumers that is derived from de-identified Chase data. The primary purpose is to get a sense of real-world debt service trends through different life stages and, therefore, more realistically save for and live in retirement. To accomplish this, we will provide insights related to important questions that underlie retirement planning assumptions. What is the average level of debt service at various life points? What is the average composition of payments across different debt types? How much do households typically pay, on average, for the specific types of debt they support? Are there specific life-cycle patterns that occur for different types of debt service? Do wealthier households manage debt service differently from households with lower asset levels? This study explores these questions and outlines high-level implications for retirement planning. PublicationFederal Civilian and Military Retirement Systems(1999) Hustead, Edwin C; Hustead, Toni PublicationUnderstanding the Macro-financial Effects of Household Debt: A Global Perspective(2019-05-02) Alter, Adrian; Feng, Alan; Valckx, NicoHigher household debt is associated with lower future GDP growth in a broad set of 80 countries over the period 1950–2016. Several institutional factors, such as flexible exchange rates, capital account openness, higher financial development and inclusion, mitigate this negative relationship. Three mutually reinforcing mechanisms help explain this relationship. First, increases in household debt amplify the probability of future banking crises, which significantly disrupts financial intermediation. Second, crash risk may be systematically neglected due to investors’ overoptimistic expectations associated with household debt booms. Third, debt overhang impairs household consumption when negative shocks hit.