Longevity and Annuities: An Introduction

Abstract

Why should there be such a change in emphasis? A cynical answer would be that so much has been written on the relative merits of PAYGO and fully funded pensions, on the issue of privatizations, on the need of fostering activity rates of elderly workers, and so on, that pension economists are forced to seek new and unplowed fields. This is a rather negative view. We also see at least three positive reasons to explain the surge of interest in the decumulation phase: the continuing shift from defined benefits to defined contributions pensions both in the public and in the private sector, the thinness of the annuity market, and the demographic changes.