Designing Pension Plans According to Consumption-Savings Theory

• 成果类型: Article; Early Access
• 署名作者: Schlafmann, Kathrin; Setty, Ofer; Vestman, Roine
• 署名单位: Copenhagen Business School; Tel Aviv University; Stockholm University
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhae061
• 发表日期: 2024
• 关键词: STOCK-MARKET PARTICIPATION; life-cycle; portfolio choice; asset allocation; income; COSTS

摘要

We derive optimal characteristics of contribution rates into defined contribution pension plans based on consumption-savings theory. Contribution rates should increase with age and decrease with the balance-to-income ratio. Using Swedish registry data, we show that on average, individuals save according to those principles. However, almost half of the population behaves hand-to-mouth and does not undo the mandated constant contribution rates. In a quantitative model, designing contribution rates to follow the principles implies a 1.8% welfare gain and less dispersed replacement rates, while maintaining the same average replacement rate. Results are robust to various sources of model misspecification, including temptation preferences.