The Risk Premium for Equity: Implications for Clinton's Proposed Diversification of the Social Security Trust Fund
Simon Grant and
John Quiggin
Working Papers from Australian National University - Department of Economics
Abstract:
Any meaningful reform of the US Social Security system must deal with the system's current outstanding accumulated unfunded liabilities. The authors model these as a once-off financial liability payable 'tomorrow'. They show that if the equity premium puzzle arises from adverse selection problems which prevent risk-spreading through market transactions, then the government can improve the ex ante welfare of the young today by acquiring equity today to assist in financing its obligations to meet social security payments to the old tomorrow.
Keywords: SOCIAL SECURITY; EQUITY; FISCAL POLICY (search for similar items in EconPapers)
JEL-codes: E62 H55 (search for similar items in EconPapers)
Pages: 12 pages
Date: 1999
References: Add references at CitEc
Citations: View citations in EconPapers (2)
There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.
Related works:
Working Paper: The Risk Premium for Equity: Implications for Clinton's Proposed Diversification of the Social Security Trust Fund (1999)
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:fth:aunaec:368
Access Statistics for this paper
More papers in Working Papers from Australian National University - Department of Economics THE AUSTRALIAN NATIONAL UNIVERSITY, DEPARTMENT OF ECONOMICS, RESEARCH SCHOOL of PACIFIC STUDIES, RESEARCH SCHOOL OF SOCIAL SCIENCES, G.P.O. 4, CANBERRA ACT 2601 AUSTRALIA..O. BOX 4 CANBERRA 2601 AUSTRALIA.. Contact information at EDIRC.
Bibliographic data for series maintained by Thomas Krichel ().