Download or read book Social Security Bequests and the Life Cycle Theory of Saving written by Alan S. Blinder and published by . This book was released on 2010 with total page 46 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper studies the asset holdings of white American men near retirement age. Assets as conventional defined show no tendency to decline with age, in apparent contradiction of the life-cycle theory of saving. However, a broadened concept of assets which includes expected future pension benefits (both public and private) and expected future earnings (quot;human wealthquot;) does decline more or less as predicted by the theory. No matter how they are defined, assets are a decreasing function of the number of children--which casts doubt on the strength of the bequest motive. Finally, financial assets and social security wealth fail to exhibit the inverse relationship suggested by Feldstein's displacement hypothesis. To investigate these issues econometrically, an equation for assets is developed from the strict life-cycle theory. The specification is generalized to allow for (a) a bequest motive, proxied by the number of children; (b) displacement of private wealth by social security wealth that is not exactly dollar-for-dollar; (c) a level of consumption late in life that differs systematically from what the strict life-cycle theory implies. The equation is estimated by nonlinear least squares on a rich cross- sectional data set containing over 4300 observations. The results show that the life-cycle model has little ability to explain cross-sectional variability in asset holdings. The model's key parameters are poorly identified, despite the large sample size and considerable cross-sectional variation in most variables. According to the estimates, consumption late in Life is on average only about half of what the strict life-cycle theory predicts; each dollar of social security wealth displaces about 3% (with a large standard error) of private wealth; and the bequest motive, while present, is quite weak.

Download or read book Essays on Saving Bequests Altruism and Life cycle Planning written by Laurence J. Kotlikoff and published by MIT Press. This book was released on 2001-06-22 with total page 596 pages. Available in PDF, EPUB and Kindle. Book excerpt: This collection of essays, coauthored with other distinguished economists, offers new perspectives on saving, intergenerational economic ties, retirement planning, and the distribution of wealth. The book links life-cycle microeconomic behavior to important macroeconomic outcomes, including the roughly 50 percent postwar decline in America's rate of saving and its increasing wealth inequality. The book traces these outcomes to the government's five-decade-long policy of transferring, in the form of annuities, ever larger sums from young savers to old spenders. The book presents new theoretical and empirical analyses of altruism that rule out the possibility that private intergenerational transfers have offset those by the government.While rational life-cycle behavior can explain broad economic outcomes, the book also shows that a significant minority of households fail to make coherent life-cycle saving and insurance decisions. These mistakes are compounded by reliance on conventional financial planning tools, which the book compares with Economic Security Planner (ESPlanner), a new life-cycle financial planning software program. The application of ESPlanner to U.S. data indicates that most Americans approaching retirement age are saving at much lower rates than they should be, given potential major cuts in Social Security benefits.

Download or read book Savings and Bequests written by Toshiaki Tachibanaki and published by University of Michigan Press. This book was released on 1994 with total page 302 pages. Available in PDF, EPUB and Kindle. Book excerpt: How do bequests explain differences in savings behavior between countries?

Download or read book Social Security Bequests and the Life Cycle Theory of Saving written by Alan S. Blinder and published by . This book was released on 1981 with total page 634 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper studies the asset holdings of white American men near retirement age. Assets as conventional defined show no tendency to decline with age, in apparent contradiction of the life-cycle theory of saving. However, a broadened concept of assets which includes expected future pension benefits (both public and private) and expected future earnings ("human wealth") does decline more or less as predicted by the theory. No matter how they are defined, assets are a decreasing function of the number of children--which casts doubt on the strength of the bequest motive. Finally, financial assets and social security wealth fail to exhibit the inverse relationship suggested by Feldstein's displacement hypothesis. To investigate these issues econometrically, an equation for assets is developed from the strict life-cycle theory. The specification is generalized to allow for (a) a bequest motive, proxied by the number of children; (b) displacement of private wealth by social security wealth that is not exactly dollar-for-dollar; (c) a level of consumption late in life that differs systematically from what the strict life-cycle theory implies. The equation is estimated by nonlinear least squares on a rich cross- sectional data set containing over 4300 observations. The results show that the life-cycle model has little ability to explain cross-sectional variability in asset holdings. The model's key parameters are poorly identified, despite the large sample size and considerable cross-sectional variation in most variables. According to the estimates, consumption late in Life is on average only about half of what the strict life-cycle theory predicts; each dollar of social security wealth displaces about 3% (with a large standard error) of private wealth; and the bequest motive, while present, is quite weak.

Download or read book Social Security and Saving written by Martin Feldstein and published by . This book was released on 1976 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Effect of Social Security on Saving written by Martin S. Feldstein and published by . This book was released on 1980 with total page 22 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper, which was presented as the 1979 Frank Paish Lecture to the British Association of University Teachers of Economics, provides a non-technical summary of the recent studies of the effects of social security on private saving. The first section discusses the theoretical indeterminacy of the effect of social security while the second part reviews the empirical studies. Although the traditional life cycle theory of saving clearly implies that the anticipation of social security benefits reduces private saving, a richer theoretical framework suggests several reasons why the saving response cannot be unambiguously established by theoretical reasoning. These reasons include the indirect effects of social security on retirement behavior, private pensions, and gifts and bequests. The econometric studies resolve this uncertainty and indicate that social security appears to reduce private saving substantially. These studies include(1) aggregate time series evidence on the U.S. saving rates over the past 50 years, (2) microeconomic evidence on the accumulation of wealth by a large sample of individual households, and (3) international comparisons of saving rates in major industrial countries

Download or read book Precautionary Saving Revisited written by R. Glenn Hubbard and published by . This book was released on 1984 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper focuses on precautionary saving against uncertain longevity and on the annuity insurance aspects of social security within the life-cycle framework. The principal findings are three. First, the evolution of social security is reviewed in response to missing markets for providing insurance for consumption in the face of lifetime uncertainty. A simple life-cycle model is used to show that even an actuarially fair, fully funded social security system can reducenational saving. Second, to the extent that the introduction of social security reduces the size of accidental bequests, the net effect on the consumption of subsequent generations is diminished. Finally, consideration of the welfare gains from compulsory social security requires an examination of the tradeoff between the benefits to early participants from access to the annuities and the costs to generations that follow of a lower capital stock. Across a range of parameter values, the partial equilibrium impact of social security on consumptionis reversed. The introduction of an explicit bequest motive ivitigates both the initial impact of social security on saving and the long-run welfare loss from the introduction of social security

Download or read book Post Keynesian Economics written by Kenneth K. Kurihara and published by Routledge. This book was released on 2013-10-08 with total page 463 pages. Available in PDF, EPUB and Kindle. Book excerpt: This volume represents the extension of Keynes' General Theory by a group of eminent economists. Each essay takes Keynes' work as a frame of reference for criticism, explorations and insights, whilst adding to the superstructure on the foundation of the General Theory. The essays also provide the necessary sense of perspective with a view to examining the Keynesian contribution to economic thought and also the limitations of Keynesian economics. The international contributors include: Dudley Dillard, Martin Bronfenbrenner, Mabel F. Timlin, William S. Vickrey, Don Patinkin, Howard R. Bowen, Gerald M. Meier, R.C.O. Matthews, Shinichi Ichimura, Anatol Murad, Lawrence R. Klein, Shigeto Tsuru, Paul P. Streeten, Lorie Tarshis and Franco Modigliani.

Download or read book Issues in Pension Economics written by Zvi Bodie and published by University of Chicago Press. This book was released on 1987-03-01 with total page 384 pages. Available in PDF, EPUB and Kindle. Book excerpt: In the past several decades, pension plans have become one of the most significant institutional influences on labor and financial markets in the U.S. In an effort to understand the economic effects of this growth, the National Bureau of Economic Research embarked on a major research project in 1980. Issues in Pension Economics, the third in a series of four projected volumes to result from thsi study, covers a broad range of pension issues and utilizes new and richer data sources than have been previously available. The papers in this volume cover such issues as the interaction of pension-funding decisions and corporate finances; the role of pensions in providing adequate and secure retirement income, including the integration of pension plans with social security and significant drops in the U.S. saving rate; and the incentive effects of pension plans on labor market behavior and the implications of plans on labor market behavior and the implications of plans for different demographic groups. Issues in Pension Economics offers important empirical studies and makes valuable theoretical contributions to current thinking in an area that will most likely continue to be a source of controversy and debate for some time to come. The volume should prove useful to academics and policymakers, as well as to members of the business and labor communities.

Download or read book Preparing for an Aging World written by National Research Council and published by National Academies Press. This book was released on 2001-06-26 with total page 326 pages. Available in PDF, EPUB and Kindle. Book excerpt: Aging is a process that encompasses virtually all aspects of life. Because the speed of population aging is accelerating, and because the data needed to study the aging process are complex and expensive to obtain, it is imperative that countries coordinate their research efforts to reap the most benefits from this important information. Preparing for an Aging World looks at the behavioral and socioeconomic aspects of aging, and focuses on work, retirement, and pensions; wealth and savings behavior; health and disability; intergenerational transfers; and concepts of well-being. It makes recommendations for a collection of new, cross-national data on aging populationsâ€"data that will allow nations to develop policies and programs for addressing the major shifts in population age structure now occurring. These efforts, if made internationally, would advance our understanding of the aging process around the world.

Download or read book Arrow and the Foundations of the Theory of Economic Policy written by George R. Feiwel and published by Palgrave Macmillan. This book was released on 2014-01-14 with total page 758 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Aging and the Macroeconomy written by National Research Council and published by National Academies Press. This book was released on 2013-01-10 with total page 230 pages. Available in PDF, EPUB and Kindle. Book excerpt: The United States is in the midst of a major demographic shift. In the coming decades, people aged 65 and over will make up an increasingly large percentage of the population: The ratio of people aged 65+ to people aged 20-64 will rise by 80%. This shift is happening for two reasons: people are living longer, and many couples are choosing to have fewer children and to have those children somewhat later in life. The resulting demographic shift will present the nation with economic challenges, both to absorb the costs and to leverage the benefits of an aging population. Aging and the Macroeconomy: Long-Term Implications of an Older Population presents the fundamental factors driving the aging of the U.S. population, as well as its societal implications and likely long-term macroeconomic effects in a global context. The report finds that, while population aging does not pose an insurmountable challenge to the nation, it is imperative that sensible policies are implemented soon to allow companies and households to respond. It offers four practical approaches for preparing resources to support the future consumption of households and for adapting to the new economic landscape.

Download or read book SSA s Retirement History Study Technical description written by and published by . This book was released on 1987 with total page 350 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Privatizing Social Security written by Martin Feldstein and published by University of Chicago Press. This book was released on 2008-04-15 with total page 484 pages. Available in PDF, EPUB and Kindle. Book excerpt: This volume represents the most important work to date on one of the pressing policy issues of the moment: the privatization of social security. Although social security is facing enormous fiscal pressure in the face of an aging population, there has been relatively little published on the fundamentals of essential reform through privatization. Privatizing Social Security fills this void by studying the methods and problems involved in shifting from the current system to one based on mandatory saving in individual accounts. "Timely and important. . . . [Privatizing Social Security] presents a forceful case for a radical shift from the existing unfunded, pay-as-you-go single national program to a mandatory funded program with individual savings accounts. . . . An extensive analysis of how a privatized plan would work in the United States is supplemented with the experiences of five other countries that have privatized plans." —Library Journal "[A] high-powered collection of essays by top experts in the field."—Timothy Taylor, Public Interest

Download or read book Demographics Pension Systems and the Saving Investment Balance written by Hua Chai and published by International Monetary Fund. This book was released on 2018-12-07 with total page 21 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper studies the effect of demographic change on national saving, global interest rates, and international capital flows, focusing on the role of the public pension system. We develop a small open economy overlapping generations model to illustrate the channels through which demographic variables and pension system generosity interact to affect both private and public saving behavior. We then extend this framework to a two-country setting and simulate scenarios of demographic change and pension reform. We find that the generosity of the pension system plays an important role in determining the movement of the global interest rate and patterns of international capital flows.

Download or read book National Saving and Economic Performance written by John B. Shoven and published by University of Chicago Press. This book was released on 2009-02-15 with total page 396 pages. Available in PDF, EPUB and Kindle. Book excerpt: The past decade has witnessed a decline in saving throughout the developed world—the United States has the dubious distinction of leading the way. The consequences can be serious. For individuals, their own economic security and that of their families is jeopardized. For society, inadequate rates of saving have been blamed for a variety of ills—decreasing the competitive abilities of American industry, slowing capital accumulation, increasing our trade deficit, and forcing the sale of capital stock to foreign investors at bargain prices. Restoring acceptable rates of saving in the United States poses a major challenge to those who formulate national economic policy, especially since economists and policymakers alike still understand little about what motivates people to save. In National Saving and Economic Performance, edited by B. Douglas Bernheim and John B. Shoven, that task is addressed by offering the results of new research, with recommendations for policies aimed to improve saving. Leading experts in diverse fields of economics debate the need for more accurate measurement of official saving data; examine how corporate decisions to retain or distribute earnings affect household-level consumption and saving; and investigate the effects of taxation on saving behavior, correlations between national saving and international investment over time, and the influence of economic growth on saving. Presenting the most comprehensive and up-to-date research on saving, this volume will benefit both academic and government economists.

Download or read book A Study of Saving in the United States Nature and derivation of annual estimates of saving 1897 to 1949 written by Raymond William Goldsmith and published by Greenwood. This book was released on 1969 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: