Note on the Optimum Pricing of Annuities
Eytan Sheshinski ()
Discussion Paper Series from The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem
In a perfectly competitive market for annuities with full information, the price of annuities is equal to individuals (discounted) survival probabilities. That is, prices are actuarially fair. In contrast, the pricing implicit in social security systems invariably allows for cross subsidization between di¤erent risk groups males/females). We examine the utilitarian approach to the optimum pricing of annuities and show how the solution depends on the joint distribution of survival probailities and incomes in the population.
Pages: 8 pages
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
Working Paper: Note on the Optimum Pricing of Annuities (2003)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:huj:dispap:dp326
Access Statistics for this paper
More papers in Discussion Paper Series from The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem Contact information at EDIRC.
Bibliographic data for series maintained by Michael Simkin ().