Self-insurance Against Natural Disasters: The Use of Pension Funds in Pacific Island Countries

Si Guo and Futoshi Narita

No 2018/155, IMF Working Papers from International Monetary Fund

Abstract: Pacific island countries are exposed to significant risks from natural disasters. As a disaster relief measure, Fiji allowed pre-retirement pension withdrawls in the wake of Cyclone Winston in 2016. Motivated by this policy action, we provide a normative analysis of the use of early pension withdrawals after disasters, by setting up a life-cycle saving model with myopic households facing large natural disaster shocks. The model demonstrates the key trade-off between building up sufficient retirement savings and ensuring the access to savings against natural disaster shocks, and sheds light on welfare implications of early pension withdrawals.

Keywords: WP; saving; withdrawal; pension saving; Fiji; amount; Insurance; Life-cycle model; Natural disasters; Pension; Small states; pension savings; one-off withdrawals assistance; withdrawal policy; contribution rate; pension withdrawals assistance; saving path; payment calculation; Pensions; Pension spending; Retirement; Consumption; Pacific Islands (search for similar items in EconPapers)
Pages: 22
Date: 2018-07-06
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.imf.org/external/pubs/cat/longres.aspx?sk=45972 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:2018/155

Ordering information: This working paper can be ordered from
http://www.imf.org/external/pubs/pubs/ord_info.htm

Access Statistics for this paper

More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC.
Bibliographic data for series maintained by Akshay Modi ().