Pension Liabilities: Fear Tactics and Serious Policy

David Rosnick and Dean Baker

CEPR Reports and Issue Briefs from Center for Economic and Policy Research (CEPR)

Abstract: This working paper argues that pension funds should adopt a funding principle that is consistent with a return on holdings conditional on the state of the stock market. As will be shown, the expected “conditional rate of return” used in making this assessment will vary depending on the current ratio of stock prices to trend corporate earnings. This funding rule will lead to a more even flow of contributions into the fund than a rule that is based on a fixed return for assets over time.

Keywords: pensions; retirement (search for similar items in EconPapers)
JEL-codes: G G2 G23 J J3 J32 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2012-01
New Economics Papers: this item is included in nep-age and nep-pke
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Journal Article: Pension Liabilities: Fear Tactics and Serious Policy (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:epo:papers:2012-02

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