Pension Benefits Research Articles

Caught in a Matrix of Factors: A Pilot Study of Female Retirees Receiving Below-Minimum Pension Payments

Pension systems based on an insurance model were originally designed for male breadwinners who worked under permanent contracts without career breaks. Since their inception, women’s participation in the workforce has increased significantly, but on average, their employment career paths are still shorter and less linear compared to those that men enjoy. Demographic changes have prompted many countries to reform their pension systems to ensure long-term financial sustainability. And to varying degrees, such reforms also have looked to address the issue of short careers. In Poland, reforms introduced in 1999 brought about significant changes to the rules governing pension entitlement. That led to the emergence of a new category of retirees—those who had contributed to the pension system for a short period and consequently received very low pensions. This article provides an overview of an exploratory qualitative pilot study conducted in 2018 with nine women who were in receipt of benefits from the Polish universal pension system, which amounted to less than the so-called ‘lowest retirement pension’ being granted at that time. The analysis makes recourse to the concept of employment career and its connection to retirement to identify various life-course determinants that contributed to their situation. These factors include childhood and adolescent adversities that affected educational attainment; domestic and caregiving responsibilities coupled with cultural expectations and insufficient institutional support; the labor market situation, and the inability to document certain employment periods. The research material indicates that a significant portion of the work performed by the interviewees throughout their lives did not translate into a pension benefit, as it either involved unpaid domestic and caregiving duties; or work performed without formal contracts.

Institutional Design of Pension Systems Versus Labor Market Structure: What Matters Most?

Abstract Since the 1980s, policy makers have favored Defined Contribution (DC) pension systems as the alternative to address the unsustainability of Defined Benefit systems. While DC schemes offer benefits and economic advantages, they also present challenges and limitations. We evaluate the mandatory DC pension system for workers in the private formal sector in Mexico, introduced in 1997. We intend to determine for which workers the design of the system is effective and for which workers it is not. The Mexican labor market has high levels of informality and workers constantly flow in and out of the formal sector. Our findings support the view that workers’ personal characteristics place them in the structure of the labor market that in turn determines pension benefits. We analyze involvement with the formal sector and the pension system and identify 3 groups of pension participants that reflect the structure of the local labor market: occasional workers, frequent interruptions, and workers with high participation rates. We conclude that frictions in the labor market prevail over the good intentions of the pension design, like reducing informality and encouraging saving for retirement. Our results show that the system properly serves only 36% of affiliated workers. We explain why very few workers report behaviors consistent with high participation, and why most affiliates have insufficient participation to receive pension benefits. We shed light on the relationship between the structure of the labor market and the design of the pension system and their impact on workers’ future pension benefits.

An Equilibrium Strategy for Target Benefit Pension Plans with a Longevity Trend and Partial Information

This paper considers the problem of portfolio selection and adjustment for target benefit plans (TBP) with longevity trends and partial information. The longevity trends are modeled by a time-varying force function. The financial market consists of risk-free assets and stocks, in which the return rate of stocks is a stochastic process and cannot be completely observed. This paper adopts the mean-variance utility model as an optimization criterion. The aim is to maximize the terminal value of the pension fund and the excess pension benefit after the participant’s retirement. The optimization equations are developed in game theory to obtain explicit solutions for the equilibrium strategies. Finally, the influence of the longevity trend on the internal structure of the pension system and the sensitivity of the equilibrium strategies to the related parameters are explored by numerical analysis. The conclusion shows that this model’s results can provide stable and adequate retirement benefits for participants.

Zjawisko wypalenia zawodowego wśród pracowników Kasy Rolniczego Ubezpieczenia Społecznego zajmujących się windykacją nienależnie pobranych świadczeń Occupational burnout phenomenon among the employees of the Agricultural Social Insurance Fund involved in collection of unduly drawn benefits

This paper presents a set of externalities and internalities which determine the behaviour and quality of tasks performed by public officers in the context of early occupational burnout syndrome following the experience of the author and of the employees of the Agricultural Social Insurance Fund (KRUS). Investigated is the impact of said factors on the level of adverse stress among employees dealing with selected issues associated with the recovery of monies under unduly drawn pension and disability benefits, sickness and care allowances, as well as other benefits for farmers and their family members, and consequently, impacting early occupational burnout in this occupational group of office staff. This paper draws from the literature, the outcome of an interview with KRUS employees, as well as from their long-standing experience and selected methods of coping with stress at work. The paper aims to set forth solutions to prevent early occupational burnout among public officers.

The Forward-Looking Effect of Increasing the Full Retirement Age

Abstract This paper analyses the effects of increasing the statutory retirement age for claiming full pension benefits on the labour force participation of middle-aged individuals and their partners. Identification relies on a difference-in-differences setting that exploits the heterogeneous increase in age eligibility for retirement caused by an unexpected pension reform. We detect a rise in the participation rate of middle-aged women that spills over into the labour supply of their husbands, who choose to postpone their retirement. The overall labour supply response has important implications for the extent of the fiscal externality associated with pension reforms that increase the retirement age.

Teacher Motivation and Attrition in Public Schools in The Gambia: A Case Study of Upper River Region (URR)

The quality of education offered to children in The Gambia's public schools can greatly be impacted by factors like teacher attrition and motivation. Despite efforts to strengthen the nation's educational system, experienced and skilled teachers frequently quit their jobs. In order to better understand teacher attrition in the Upper River of the country, this study looked at Public Basic and Secondary Schools in the region and evaluated factors affecting teacher motivation and attrition. The study employed the survey research technique with a sample of current and previous teachers. In-depth interviews and questionnaires were used to gather primary data. Descriptive statistical methods, such as basic percentages, frequency distributions, and graphical representations, were used to analyse the acquired data. The researchers relied on the Ministry of Basic and Secondary Education and other internet sources to access secondary data. Trend analysis of teacher attrition from 2015 to 2019 was conducted in the region, which indicates a decline in teacher attrition. This may be the result of the ministry's strategy of recruiting teachers based on the regions they come from so that they do not have to travel long distances to attend school.
 The study showed that inequality in training opportunities, leadership style, salaries and other monetary benefits, merit-based performance, supportive work environment, etc. are key factors responsible for teacher attrition in Public Basic and Secondary Schools in the region. Most respondents are dissatisfied with the work environment, merit-based performance appraisals, pension and retirement plans and benefits, opportunities for promotion, and management style. However, job security stood out as a motivational package that the respondents regard as satisfactory. Whiles determining the effects of teacher attrition in the region, the study findings reveal that student migration, admissions difficulties, poor performance, wide time–lag in work schedule, and the increase in the workload of teachers and administrators pose serious challenges to the schools. The findings suggest that low salaries, lack of opportunities for professional development and advancement, inadequate resources and support, and poor working conditions are major factors contributing to teacher attrition and demotivation in the region. The study's findings further indicate that the incentive programmes offered to teachers in URR are not sufficient.

Delay the Pension Age or Adjust the Pension Benefit? Implications for Labor Supply and Individual Welfare in China

We develop and calibrate a life-cycle model of labor supply and consumption to quantify the implications of alternative pension reforms on labor supply, individual welfare, and government budget for Chinas basic old-age insurance program. We distinguish low-skilled and high-skilled individuals, who differ in their preferences, health and labor income dynamics, and medical expense processes. We use the calibrated model to evaluate three potential pension reforms: (i) increasing the pension eligibility age from 60 to 65, but keeping the current pension benefit formula unchanged; (ii) keeping the pension eligibility age at 60, but proportionally lowering pension benefits so that the pension program’s budget is the same as under Reform (i); and (iii) increasing the pension eligibility age to 65 and simultaneously increasing the pension benefits so that individuals of both skill types attain the same individual welfare levels as in the status quo. We find that relative to the baseline, both Reforms (i) and (ii) can substantially improve the budgets of the pension system, but at the cost of substantial individual welfare loss for both skill types. In contrast, we find that Reform (iii) can modestly improve the budget of the pension system while ensuring that both skill types are as well off as in the status quo. We find that Reforms (i) and (ii) slightly increase, but Reform (iii) slightly decreases, the overall labor supply.

The analysis of problems of supporting long-term nursing of individuals who lost their ability to self-care in Russia

The article considers the issues of social assistance of long-term care of individuals who lost ability to self-care. The comparative analysis of established practices of social assistance of long-term care, of legal and financial support of family members implementing such a care in Russia and European countries is presented. The study was carried out using comparative jurisprudence methodology. The analysis of legislative acts of the European countries revealed possibility of including particular legal provisions concerning financing of long-term care and implementing contractual forms of regulation of employment of family members providing such care, in the Russian social welfare system. The study demonstrated inadequate efficiency of the Russian systems of legal protection and social assistance both individuals seeking long-term care and individuals implementing it, as compared with similar systems in the European countries. To improve these systems, it is necessary to recognize legislatively the care of relative who lost the ability of self-serve as labor function liable to payment based on minimum wage rate. To fix legislatively retention of workplace for caregiver for entire period of caring and/or grant him unpaid vacation for long period. It is necessary to adjust both amount of benefits for care of family member who lost ability to self-care and procedure of calculation of amount of pension benefit of caregiver. The study results can contribute to widening scientific and practical professional discussion in the field of public health, health care organization and social work concerning problems of optimization of means and modes of supporting long-term care of persons who lost ability to self-care. The study results can serve as ground for making amendments to national legislation to harmonize legal support of social welfare system and to improve protection of rights of family members caring relative who lost ability to self-care in conditions of forced loss of income.

REACHING RETIREMENT AGE BY OLDER PERSONS. TRENDS AND CHALLENGES

Each year, over 300,000 persons retire from the labour market in Poland. This is a worrying phenomenon especially in the light of the population ageing. It causes a loss for the economy of valuable labour resources, which are increasingly scarce. It also puts a heavy burden on public finance with the payment of an increasing number of old-age pension benefits. Retiring early immediately after obtaining entitlement or within a few months after this occurrence increases a risk of poverty. Pensions in Poland are generally low; the amount of the calculated benefit increases significantly with each additional year of work and payment of old-age insurance contributions. The article describes the issues related to the possibility of encouraging persons who have obtained the entitlement to an old-age pension to remain in the labour market and defer claiming the benefit. Based on the results of the Institute of Labour and Social Studies research project on mitigating the effects of the pandemic among high-risk groups, the author analysed the main reasons for retirement of persons at pensionable age and the motives indicated by them for continuing employment or returning to the labour market. On this basis, using selected elements of the support model developed in the cited project, solutions have been identified that may without the need to raise the statutory retirement age reduce the outflow of persons at retirement age from the labour market.

Tinjauan Yuridis Pelaksanaan Jaminan Sosial Tenaga Kerja di PT. Mitratani Dua Tujuh Kabupaten Jember

Every worker has rights and obligations that must be fulfilled and vice versa for the company. Workers as executors must have their rights guaranteed through social insurance. In the Amendment to Article 28 H of the 1945 Constitution paragraph (3) stipulates that everyone has the right to obtain social insurance for their survival, including workers. Implementation of the workers' social insurance program at PT. Mitratani Dua Seven Jember Regency is divided into 2 (two) type: first type is Permanent Employees and Contract Employess (PKWT) and second type is Seasonal Employees. Permanent employees and PKWT are registered in 4 (four) insurance programs are: Old Age Benefits (JHT), Work Accident Benefits (JKK), Death Benefits (JKM) and Pension Benefits (JP), while seasonal employees are registered in 3 (three) insurance programs, namely Old Age Benefits ( JHT), work accident insurance (JKK), death insurance (JKM). Obstacles in the implementation of the Employment BPJS program for seasonal workers are related to the very high entry and exit of workers because they cannot adapt to the work environment.

Currency crisis: Turkey in 2021

Research methodology This case study is developed from secondary sources. Two types of data were used to develop this case. The statistical data are gathered from sources such as Yahoo! Finance, Trading Economics, Investing.com and The Central Bank of the Republic of Turkey. Reports on market developments are gathered from major news outlets such as Bloomberg, The Wall Street Journal and Reuters. Case overview/synopsis The year 2021 was a volatile year for the Turkish economy: it ended the year with 36% annual inflation, 44% currency devaluation, shortages of basic goods, street protests, etc. How does the Turkish currency crisis in 2021 play out in various financial markets such as the foreign exchange, bond, stock and cryptocurrency markets? This case study introduces students to Turkey’s economic crisis in 2021 and how the Turkish lira’s depreciation, home inflation and central bank policies interact to affect its various financial markets. In the bond market, a depreciated lira heightened the credit risk of Turkey’s bond issuers and effectively crippled the country’s bond market. In contrast, Turkey’s stock and cryptocurrency markets experienced a rally as Turks put their money into equities and cryptocurrencies to hedge against inflation. In international trade, the lira’s fall and the supply chain disruptions in Asia benefited Turkish exporters tremendously. In contrast, Turkish importers suffered. In the Turkish society, the impact of the currency and inflation crisis fell the hardest on ordinary folks, who saw the values of their wages and pension benefits erode. In times of hardship, socially responsible citizens helped the poor by anonymously paying for others’ unpaid bills. Complexity academic level Given the multicomplexity of a currency crisis, this case would be valuable for finance/economics students to understand how a country’s currency crisis and its central bank policies interact to impact its various financial markets. This case is appropriate for courses in Markets and Institutions with a global or cultural learning objective. Learning Objectives 1. Describe how the Turkish lira’s depreciation affected its various financial markets, such as foreign exchange, bond, stock and cryptocurrency markets.2. Understand the cultural perspective on usury, how it exists in modern-day finance, and its’ role in President Recep Tayyip Erdoğan’s economic policy.3. Compare and contrast Turkey’s export and import industries and how they are being affected by the lira’s depreciation.4. Evaluate the risk exposure of foreign investors who participate in Turkey’s stock market given a depreciating lira.5. Evaluate the creditworthiness of Turkish corporations who issued dollar- or euro-denominated bonds as well as issuers of lira-denominated bonds given a depreciating lira.6. Understand the social impacts of a currency crisis and the charitable acts of socially responsible citizens.

Asset redeployability and CEO inside debt

AbstractUsing a large sample of US firms for the period 2006–2015, we investigate the relationship between asset redeployability (AR) and a Chief Executive Officer's (CEO) inside debt holdings (CID) (pension benefits and deferred compensation). We find a positive association between AR and CID. In addition, we also find that this relationship is stronger in firms that are more financially constrained and during times of economic uncertainty. Collectively, these findings suggest that asset market frictions captured by AR are better determinants of liquidation value than asset tangibility. Our results are robust to an array of sensitivity/robustness tests and endogeneity concerns.

Who wants (them) to work longer?

This paper examines age-specific individual preferences for the legal retirement age. Within a theoretical model, we develop the hypothesis that retirees prefer a higher legal retirement age than workers, and that newly retired individuals prefer the highest retirement age. Retirees benefit from a positive fiscal externality. A higher legal retirement age leads to higher pension benefits, without retirees having to bear the costs in the form of a longer working life. We corroborate the hypothesis empirically with a fuzzy regression discontinuity design and show that newly retired individuals are indeed most in favor of an increasing retirement age. We conclude that in aging societies the political feasibility of raising the legal retirement age increases.

Priming or learning? The influence of pension policy information on individual preferences in Germany, Spain and the United States

A promising approach to pension policy preferences focuses on the influence of policy related information. We advance this research programme by examining the impact of information about future pension benefits, including whether information effects occur through priming, learning or both. Drawing on a novel, split-sample survey experiment in the US, Germany and Spain, we examine the impact of information on forecasted pension replacement rates for 2040 on pension policy attitudes. Findings indicate that the information treatment increases support for the two outcomes considered: (i) increases in the pensionable age and (ii) greater spending on pensions relative to other social programmes. Analyses of heterogeneous treatment effects accounting for prior beliefs of participants show that information effects occur both through priming and learning. The study concludes that hard, non-partisan information increases support for reforms that foster the financial sustainability of pension systems, although the scope of information effects depends on contextual conditions.

Investigating pension choice factors among the faculty of public sector universities in Pakistan

PurposeThis research designed, optimized and tested a context-specific scale to evaluate public sector employees' pension choices.Design/methodology/approachThe authors developed the scale using a comprehensive process of interviews and focus groups with experts across academia and finance. The authors used the refined scale to collect data from 564 faculty members in public sector universities following a multistage systematic cluster sampling technique. The findings revealed diversity in choice across different socio-economic and demographic variables.FindingsThe results revealed that items related to the defined benefit pension system explain most of the data variance and are preferred widely. This is followed by a preference for monetizing pension benefits and a defined contribution system. These findings indicated the need for flexible pension plans.Practical implicationsTherefore, the progressive movement towards monetization and the shift from defined benefit to a defined contribution pension system due to economic pressures must be accurately calculated and introduced where it is suitable.Originality/valueAlthough the theory of introducing a defined contribution pension system and monetization system is appealing, its practical implementation may not be encouraging for all employees.

Integrated Information and Communication Media Based on Organization Goal-Oriented Requirement Engineering (OGORE)

The BPD NTT pension fund is a company incorporated as a legal entity that manages and runs a pension benefit program for BPD NTT employees. In its current business process, BPD NTT does not yet have a capable media to accommodate the information and communication needs of participants and interested parties, as a business branding and service facility for the participants. The problem that occurs is in the need elicitation stage when developing the information and communication media. For example, if the development is carried out by applying the Global eXtreme Programming (GXP) model, in the exploration phase the Organizational Goal-Oriented Requirement Engineering (OGORE) method will be applied to elicit needs that base each activity on organizational goals. The results of the research are in the form of web-based information and communication media modeling based on IT goals which are described in various tasks equipped with actors and resources used as well as KPIs that are integrated into each goal.

Gender wage and longevity gaps and the design of retirement systems

We study the design of pension benefits for male and female workers. Women live longer than men but have a lower wage. Individuals can be single or live in couples who pool their incomes. Social welfare is utilitarian but an increasing concave transformation of individuals’ lifetime utilities introduces the concern for redistribution across individuals with different lifespans.We derive the optimal direction of redistribution and show how it is affected by a gender neutrality rule. With singles only, a simple utilitarian solution implies redistribution from males to females. When the transformation is sufficiently concave redistribution may or may not be reversed. With couples only, the ranking of gender retirement ages is always reversed when the transformation is sufficiently concave.Under gender neutrality pension schemes must be self-selecting. Gender neutrality implies distortions of retirement decisions, limits redistribution and, negatively affects the group towards which redistribution is targeted. With couples, a first best that implies a lower retirement age for females can be implemented by a gender-neutral system. Otherwise, gender neutrality implies equal retirement ages and restricts the possibility to compensate the shorter-lived individuals. Calibrated simulations show that when singles and couples coexist, gender neutrality substantially limits redistribution in favor of single women and fully prevents redistribution in favor of male spouses.

MECANISMO ALTERNATIVO A NÃO INCIDÊNCIA DO FATOR PREVIDENCIÁRIO NA APOSENTADORIA POR TEMPO DE CONTRIBUIÇÃO

The pension factor is a multiplicative factor to the amount of pension benefit retirement contributions, and optionally will retirement age, the General Social Security System. On November 4, 2015 was sanctioned by the President of Brazil to the Republic Act nº 13.183, which in its Article 29-C presents an alternative the incidence of social security factor. Given this perception, this article aims to conduct an analysis of the alternative mechanism to no impact of this factor in retirement by contribution time, talking about the security factor and how your calculation as well asdeal with the rules of the new method 85/95 in order to demystify what is the most beneficial factor for individuals in society that seek retirement.

Quantifying and explaining the decline in public schoolteacher retirement benefits

AbstractWe estimate that, between 2000 and 2020, the average initial monthly retirement benefit for teachers retiring with 30 years of service has been reduced by 11.2%, though the decline in benefits varies substantially across the states (the median reduction in the initial benefit was 1.9%). We also find that plans covering only teachers, and plans in which teachers are not in Social Security, have made smaller reductions in the generosity of their pension benefits.

Determinants of Preferred Retirement Age in an Aging Society

Theoretical background: The process of aging has profound economic consequences for many countries, as it increases the number of beneficiaries of the pension system and extends the period of receiving pension benefits. We claim that understanding individual preferences concerning the retirement age is one of the key factors of successful reforms of pension systems and a prerequisite to convince a greater number of individuals to retire later. Purpose of the article: The aim of the article is to determine factors influencing the decision on the moment of retirement. The analysis takes into account socio-economic characteristics of individuals (including gender, age, education, health and income), as well as individual expectations and relative deprivation. The second goal is to compare preferences of men and women concerning the retirement age. Research methods: The empirical part of the article exploits a dataset based on primary research conducted in Poland which is one of the fastest aging countries in Europe (data for N = 448 respondents were collected with the help of an online questionnaire from April to May 2021). Both purposes are achieved with the help of econometric methods (OLS, quantile, and logit regressions). Main findings: We show that individuals have heterogeneous preferences concerning the retirement age, but on average they are willing to retire later than others (and often later than the official retirement age). We argue that one of the driving forces behind this phenomenon is associated with aversion towards relative deprivation. We demonstrate that individual preferences concerning the retirement age are not directly dependent on the current situation of respondents (depicted, e.g. by their education, health, place of living or income), but are determined by their expectations concerning their material situation when retired and by preferences regarding others. We also discuss some differences between men and women with regard to the preferred retirement age (e.g. women are more frequently ready to retire later than the official retirement age compared to men, but in general propose lower retirement age than men for both genders).