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Financial Aspects of the United States Pension System

This book provides valuable information and analysis to managers, policymakers, and investment counselors in the rapidly expanding field of pension funding. American workers, too, need answers and insights on how to invest their money and plan for their retirement. fifteen of America’s leading financial analysts address such pressing questions as
-What is the current financial status of the elderly, and how vulnerable are they to inflation?
-What is the impact of inflation on the private pension system, and what are the effects of alternative indexing schemes?
-What roles can the social security system play in the provision of retirement income?
-What is the effect of the tax code and the Employee Retirement Income Security Act of 1974 (ERISA) on corporate pension policy?
-How well funded are corporate pension plans, and is a firm’s unfunded pension liability fully reflected in the market value of its common stock?
Many of the conclusions these experts reach contradict and challenge popular views, thus providing fertile ground for innovation in pension planning.

462 pages | 6.00 x 9.00 | © 1984

National Bureau of Economic Research Project Report

Economics and Business: Business--Industry and Labor

Table of Contents

Zvi Bodie and John B. Shoven
1. Who Owns the Assets in a Defined-Benefit Pension Plan?
Jeremy I. Bulow and Myron S. Scholes
Comment: Jerry Green
2. Economic Implications of ERISA
Jeremy I. Bulow, Myron S. Scholes, and Peter Menell
Comment: Richard J. Zeckhauser
3. Pensions as Severance Pay
Edward P. Lazear
Comment: David A. Wise
4. Optimal Funding and Asset Allocation Rules for Defined-Benefit Pension Plans
J. Michael Harrison and William F. Sharpe
Comment: Irwin Tepper
5. Pension Funding, Pension Asset Allocation, and Corporate Finance: Evidence from Individual Company Data
Benjamin M. Friedman
Comment: Jay O. Light
6. Investing for the Short and the Long Term
Stanley Fischer
Comment: Fischer Black
7. Pension Funding Decisions, Interest Rate Assumptions, and Share Prices
Martin Feldstein and Randall Morck
Comment: Stewart C. Myers
8. Should Private Pensions Be Indexed?
Martin Feldstein
9. Observations on the Indexation of Old Age Pensions
Lawrence H. Summers
Comment: John Bossons
10. On Consumption Indexed Public Pension Plans
Robert C. Merton
Comment: Paul A. Samuelson
11. Retirement Annuity Design in an Inflationary Climate
Zvi Bodie and James E. Pesando
Comment: Franco Modigliani
12. On the Role of Social Security as a Means for Efficient Risk Sharing in an Economy Where Human Capital Is Not Tradable
Robert C. Merton
13. The Economic Status of the Elderly
Michael D. Hurd and John B. Shoven
Comment: Daniel Feenberg
14. Portfolio Composition and Pension Wealth: An Econometric Study
Louis-David L. Dicks-Mireaux and Mervyn A. King
Comment: Alan J. Auerbach
List of Contributors
Author Index
Subject Index

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