eBook

New policies for mandatory defined contribution pensions : industrial organization models and investment products

Impavido, Gregorio, Lasagabaster, Esperanza, García-Huitrón, Manuel

2010,2011

Overview

The recent financial crisis is challenging the reform approach to mandated pension a scheme that has emerged over recent decades across the world. This reform approach is characterized by a move toward multi-pillar pension systems and includes the creation or extension of a mandatory funded pillar with defined contribution design. The rationale and viability of such a pillar is contingent on an enabling environment and the delivery of high risk-adjusted net rates of return that beat the natural benchmark, which is the internal rate of return that an unfunded mandated scheme is able to achieve. Two key aspects of mandated and funded defined contribution schemes have been under discussion and investigation since dedicated pension funds were created: (a) the high fees levied by privately organized pension funds and the consequence for the net rate of return; and (b) the investment products of these funds and their capability to address the investment risks and to deliver the expected retirement income in a life-cycle context. To this end, country policies have experimented with a variety of approaches to improve outcomes with some important leads but overall modest results. This book proposes to take a fresh and highly innovative look at both policy issues. It suggests stepping back and looking at the underlying causes of the issues at stake instead of merely trying to address their symptoms. In addressing the high fees of pension funds, it focuses on the less-than-ideal conditions inert consumers facing firms with market powers and proposes to apply solutions derived from industrial organization models and pricing methods that better reflect the cost structure of the supply of pension services. In addressing the investment risks, it asks how to improve fund managers' risk-adjusted investment performance when participants are inert.

• Publisher: World Bank,World Bank Publications,The World Bank
• Subject: ACCOUNTING / ADMINISTRATIVE COSTS / ADMINISTRATIVE FEE / ADMINISTRATIVE FEES / AMOUNT OF CAPITAL / ANNUAL STATEMENTS / ANONYMOUS REVIEWERS / ASSET ALLOCATION / ASSET ALLOCATIONS / ASSET BASE / ASSET MANAGEMENT / ASSET MANAGER / ASSET MANAGERS / ASSET PORTFOLIO / ASSET PRICES / AUCTION / AUCTION MECHANISMS / BANKS / BARRIERS TO ENTRY / BEHAVIORAL ECONOMICS / BEQUEST / BEQUESTS / BONDS / BUSINESS PLAN / BUSINESS SCHOOL / CALCULATIONS / CAPITAL MARKET / CAPITAL MARKET DEVELOPMENT / CAPITAL MARKETS / CAPITAL REQUIREMENTS / CASH BALANCES / COLLATERAL / competition policy / COMPETITIVE MARKETS / CONFLICTS OF INTEREST / CONSUMER / CONSUMER BEHAVIOR / CONSUMER PROTECTION / CONSUMERS / CONTRIBUTION / CONTRIBUTION RATES / CONTRIBUTION SCHEMES / CONTRIBUTION SYSTEMS / CORPORATE GOVERNANCE / CUSTOMER BASE / DEFERRED ANNUITIES / DEFICITS / DEFINED CONTRIBUTION PENSION / Defined contribution pension plans / DEFINED CONTRIBUTION PENSIONS / DEVELOPMENT BANK / DISABILITY / DISABILITY INSURANCE / DISPOSABLE INCOME / DIVERSIFICATION / EARNINGS / EMERGING MARKETS / Employment-Based Pension / ENABLING ENVIRONMENT / ENTRY BARRIERS / EQUITIES / EQUITY INVESTMENT / EXPENDITURE / EXPENDITURES / FEE STRUCTURES / FINANCIAL ASSETS / FINANCIAL CRISIS / FINANCIAL DECISIONS / FINANCIAL ECONOMIST / FINANCIAL EDUCATION / FINANCIAL EDUCATION PROGRAMS / FINANCIAL GROUP / FINANCIAL INSTITUTIONS / FINANCIAL INTERMEDIATION / FINANCIAL MARKET / FINANCIAL MARKET DEVELOPMENT / FINANCIAL MARKETS / FINANCIAL SECTOR / FINANCIAL SERVICE / FINANCIAL SERVICE PROVIDERS / FINANCIAL SERVICES / FINANCIAL STABILITY / FINANCIAL TRANSACTIONS / FISCAL POLICY / FIXED COSTS / FRAUD / FUND MANAGER / FUND MANAGERS / GLOBALIZATION / GOVERNMENT INTERVENTION / GROSS DOMESTIC PRODUCT / HOLDING / HOLDINGS / INCOME / INDIVIDUAL ACCOUNT / INDIVIDUAL ACCOUNTS / INDIVIDUAL SAVINGS / Industrial organization / INHERITANCE / INSURANCE / INSURANCE COMPANIES / INSURANCE MARKETS / INTERNAL RATE OF RETURN / INTERNATIONAL BANK / INTERNATIONAL FINANCE / Investment analysis / INVESTMENT CHOICE / INVESTMENT CHOICES / INVESTMENT CLIMATE / INVESTMENT DECISION / INVESTMENT DECISIONS / INVESTMENT FUNDS / INVESTMENT PERFORMANCE / INVESTMENT PRODUCTS / INVESTMENT REGULATION / INVESTMENT RISK / INVESTMENT RISKS / INVESTMENT STRATEGIES / INVESTMENT STRATEGY / INVESTOR PROTECTION / JOB CREATION / LACK OF INTEREST / LADF / Latin American Development Forum / LEVY / LIABILITY / life-cycle fund / LIFETIME / LONG-TERM ASSET / LONG-TERM INVESTMENT / LOSS AVERSION / LOW FINANCIAL LITERACY / LOW INCOME / LOW-INCOME CONSUMERS / MANDATORY PENSION FUNDS / MARKET CONCENTRATION / MARKET DISCIPLINE / MARKET INCENTIVES / MARKET RISK / MARKET SHARE / MARKET SHARES / MARKETING / MARKETING EFFORTS / MARKETING STRATEGIES / MASS MEDIA / MONETARY FUND / MUTUAL FUND / NET WORTH / OLIGOPOLY / OPTIMAL INVESTMENT / ORIGINAL INVESTMENT / pension / PENSION ACCOUNT / PENSION ASSET / PENSION ASSETS / PENSION CONTRIBUTIONS / PENSION FUND / PENSION FUND ADMINISTRATOR / PENSION FUND ADMINISTRATORS / PENSION FUNDS / PENSION INCOME / PENSION MARKET / PENSION MARKETS / PENSION PLAN / PENSION PLANS / PENSION POLICY / PENSION PRODUCTS / PENSION REFORM / PENSION REFORMS / PENSION SCHEMES / PENSION SYSTEM / PENSION SYSTEMS / Pensions / POLICY RESPONSES / PORTFOLIO / PORTFOLIO CHOICE / PORTFOLIO MANAGEMENT / PORTFOLIOS / PRIVATE PENSION / PRIVATE PENSIONS / PROBABILITY / PRODUCTIVITY / PROVISION OF INFORMATION / PRUDENTIAL REGULATION / PUBLIC INFORMATION CAMPAIGNS / PUBLIC PENSION / PURCHASING POWER / RATE OF RETURN / RATES OF RETURN / RATES OF RETURNS / RECORD KEEPING / REGULATORY BARRIER / REGULATORY FRAMEWORK / REMITTANCES / RENTS / REPLACEMENT RATES / RESERVE / RESERVES / RESUME / RETIREMENT / RETIREMENT AGE / RETIREMENT DATE / RETIREMENT INCOME / RETURNS ON EQUITY / RISK DIVERSIFICATION / RISK PREMIUM / RISK SHARING / SALARIES / SALARY / SALE / SALES / SALES AGENT / SALES AGENTS / SALES TACTICS / SAVERS / SENIOR / SOCIAL PROTECTION / SOCIAL SECURITY / SOCIAL SECURITY PENSION / SOCIAL WELFARE / START-UP COSTS / SUPERANNUATION SYSTEM / SUPERVISORY AGENCY / TAX / TAX POLICY / TRUSTEE / VALUABLE / VALUE OF ASSETS / VALUE OF PENSIONS / VOLUNTARY PLANS
• ISBN: 9780821382769, 0821382764, 0821383175, 9780821383179