Choices in Pension Management


Gosse Alserda
  • Speaker
Erasmus School of Economics (ESE), Erasmus University Rotterdam

Event Information

Type
PhD Defence
Programme
Finance
Date
Fri. 22 Dec. 2017
Contact
Gosse Alserda
Time
11:30-13:00
Location
Senate Hall, Erasmus Building, Woudestein Campus


Abstract

The organization of pensions differs greatly across, and within, countries, and these differences affect the large number of stakeholders differently. The choices that underlie these differences tend to be very complicated, as they have to be balanced over the interests of different stakeholders over time.

 

The first two studies of this doctoral thesis analyse heterogeneity in pension plan risk preferences. Using an augmented risk preferences elicitation method, we find strong heterogeneity in latent risk preferences. Together with institutional differences these affect the optimal asset allocation. Therefore, it is worthwhile to elicit risk preferences.

 

The third study focuses on pension fund administration and investment costs. We show that there are large economies of scale for pension fund administrations, and modest diseconomies of scale for investment activities. Many pension funds have substantial X-inefficiencies for both administrative and investment activities. The study suggests that consolidation of pension funds may be efficiency enhancing.

 

The fourth study investigates pension fund discontinuity events. The occurrence and impact of these events is strongly dependent on the institutional setting of pensions. Stricter regulations increase the financial stability of the pension fund, but may reduce membership support through lower replacement rates. This trade-off influences the management of pension funds.

 

Taken together, this dissertation scrutinizes the complexity of choices in pension organization. Choices in pensions depend on the particular institutional setting of pensions and on specific pension plan member characteristics. These choices affect a great many stakeholders of pensions through different channels, both directly and indirectly.

Fieke van der Lecq
Fieke van der Lecq
Professor of Pension Markets
  • Promotor
Onno Steenbeek
Professor of Pension Fund Risk Management
  • Promotor
Jaap Bikker
Jaap Bikker
  • Member Doctoral Committee
Benedict Dellaert
Professor of Marketing
  • Member Doctoral Committee
Alfred Slager
Alfred Slager
  • Member Doctoral Committee
Stefan Trautmann
Stefan Trautmann
  • Member Doctoral Committee
Patrick Verwijmeren
Professor of Corporate Finance
  • Member Doctoral Committee