The Promise of Defined-Ambition Plans

Lessons for the United States

Research output: Book/ReportReportProfessional

Abstract

This paper explores proposals for defined-ambition plans in Dutch occupational pensions. Firms no longer act as external risk sponsors but continue to provide a distributional platform for pensions, thereby addressing behavioral and agency issues as well as imperfections of insurance and financial markets. Pension entitlements are defined in terms of (deferred) annuities, and participants share the risks of assets and a joint liability pool on the basis of complete contracts. We investigate risk management and valuation of these plans, explore their strengths and weaknesses, and analyze whether such plans hold promise for the United States.
Original languageEnglish
Place of PublicationTilburg
PublisherNETSPAR
Number of pages30
Publication statusPublished - Mar 2014

Publication series

NameNETSPAR Occasional Papers

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Pensions
Insurance market
Financial markets
Risk management
Sponsor
Annuities
Assets
Entitlement
Joint liability
Occupational pension
Imperfections

Cite this

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title = "The Promise of Defined-Ambition Plans: Lessons for the United States",
abstract = "This paper explores proposals for defined-ambition plans in Dutch occupational pensions. Firms no longer act as external risk sponsors but continue to provide a distributional platform for pensions, thereby addressing behavioral and agency issues as well as imperfections of insurance and financial markets. Pension entitlements are defined in terms of (deferred) annuities, and participants share the risks of assets and a joint liability pool on the basis of complete contracts. We investigate risk management and valuation of these plans, explore their strengths and weaknesses, and analyze whether such plans hold promise for the United States.",
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The Promise of Defined-Ambition Plans : Lessons for the United States. / Bovenberg, A.L.; Mehlkopf, R.J.; Nijman, T.E.

Tilburg : NETSPAR, 2014. 30 p. (NETSPAR Occasional Papers).

Research output: Book/ReportReportProfessional

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