NDC schemes and heterogeneity in longevity: proposals for redesign

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dc.contributor.author Holzmann, Robert
dc.contributor.author Alonso-Garcia, Jennifer
dc.contributor.author Labit-Hardy, Heloise
dc.contributor.author Villegas, Andres M.
dc.date.accessioned 2019-08-01T07:10:46Z
dc.date.available 2019-08-01T07:10:46Z
dc.date.issued 2019-08-01
dc.identifier.citation Holzmann R., Alonso-García J., Labit-Hardy H., Villegas A. M., NDC schemes and heterogeneity in longevity: proposals for redesign (2019), Roma, INAPP, WP, n. 24 <http://oa.inapp.org/xmlui/handle/123456789/461> en_US
dc.identifier.uri http://oa.inapp.org/xmlui/handle/123456789/461
dc.description.abstract A positive relationship between lifetime income and life expectancy leads to a redistribution mechanism when the average cohort life expectancy is applied for annuity calculation. Such a distortion puts into doubt the main features of the NDC (nonfinancial defined contribution) scheme and calls for alternative designs to compensate for the heterogeneity. This paper explores five key mechanisms of compensation: individualized annuities; individualized contribution rates; a two-tier contribution structure with socialized and individual rates; and two supplementary two-tier approaches to deal with the income distribution tails. Using unique American and British data, the analysis indicates that both individualized annuities and two-tier contribution schemes are feasible and effective and thus promising policy options. A de-pooling by gender will be required, however. en_US
dc.language.iso en en_US
dc.subject Invecchiamento della popolazione en_US
dc.subject Pensionamento en_US
dc.subject Pensione en_US
dc.title NDC schemes and heterogeneity in longevity: proposals for redesign en_US
dc.type Working Paper en_US

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