Differentiating Indexation in Dutch Pension Funds

29 Pages Posted: 20 Jan 2011

See all articles by Roel M. W. J. Beetsma

Roel M. W. J. Beetsma

University of Amsterdam - Research Institute in Economics & Econometrics (RESAM); European Commission; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); Tinbergen Institute; Netspar

Alessandro Bucciol

University of Verona - Department of Economics; Netspar

Multiple version iconThere are 2 versions of this paper

Date Written: December 30, 2010

Abstract

We investigate numerically how indexation of funded pensions for inflation can be differentiated across the various groups of fund participants. The pension arrangement is modelled after the Dutch situation. While the aggregate welfare consequences are small, group-specific consequences are more substantial with the workers and future born losing and retirees benefitting from a shift away from uniform indexation. Those welfare shifts result from systematic redistribution of welfare rather than shifts in the benefit of risk sharing provided by the system.

Keywords: indexation, funded pensions, welfare effects, pension buffers, stochastic simulations

JEL Classification: H55, I38, C61

Suggested Citation

Beetsma, Roel M. W. J. and Bucciol, Alessandro, Differentiating Indexation in Dutch Pension Funds (December 30, 2010). CESifo Working Paper Series No. 3305, Available at SSRN: https://ssrn.com/abstract=1742767 or http://dx.doi.org/10.2139/ssrn.1742767

Roel M. W. J. Beetsma (Contact Author)

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