Pension Funding in the Public Sector

38 Pages Posted: 7 Nov 2007 Last revised: 28 Aug 2022

See all articles by Olivia S. Mitchell

Olivia S. Mitchell

University of Pennsylvania - The Wharton School; University of Pennsylvania - The Wharton School, Pension Research Council; National Bureau of Economic Research (NBER)

Robert S. Smith

Cornell University - School of Industrial and Labor Relations

Date Written: November 1991

Abstract

This paper explores the determinants of pension funding in the public sector. We formulate and test several hypotheses about the determinants of public employer pension funding practices, using a new data set describing financial and other characteristics of state, local, and teacher plans. The data show that, on average, public sector pension plans were relatively well-funded during the late 1980s. There were, however, wide variations in funding practices in our sample. Our analysis of these variations suggests that past funding practice tends to be perpetuated, that unionized employers are less likely to fully fund future pension obligations, and that funding is sensitive to fiscal pressure.

Suggested Citation

Mitchell, Olivia S. and Smith, Robert Stewart, Pension Funding in the Public Sector (November 1991). NBER Working Paper No. w3898, Available at SSRN: https://ssrn.com/abstract=474005

Olivia S. Mitchell (Contact Author)

University of Pennsylvania - The Wharton School ( email )

Philadelphia, PA 19104-6365
United States

University of Pennsylvania - The Wharton School, Pension Research Council ( email )

3302 Steinberg Hall-Dietrich Hall
3620 Locust Walk
Philadelphia, PA 19104-6302
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Robert Stewart Smith

Cornell University - School of Industrial and Labor Relations ( email )

Ithaca, NY 14853-3901
United States

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