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Individaul Accounts for Social Security Reform

International Perspectives on the U.S. Debate

John A. Turner

Publication Year: 2006

John Turner uses the documented experiences of many countries—including the U.K., Sweden, Chile, Australia, Canada, and others—and the tools of economics to analyze the public policy issues surrounding the proposed implementation of individual accounts as part of the U.S. Social Security system. The result is a book that clarifies these issues while offering direction to Social Security policymakers. Also included is a comprehensive overview of the types of defined contribution plans in use today.

Published by: W.E. Upjohn Institute

Title Page, Copyright

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Table of Contents

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pp. v-viii

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Acknowledgments

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pp. ix-x

I began thinking about this book while working in Geneva, Switzerland, for the International Labor Office on a volume on social security reform around the world (Social Security Pensions: Development and Reform [Gillion et al. 2000]). This current book follows the structure of an Upjohn Institute volume I coauthored ...

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1. Individual Accounts and Social Security Reform

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pp. 1-8

Defined contribution pension plans providing workers with individual accounts dominate pension plan growth worldwide. Contributions are made into the accounts, usually by workers and sometimes by employers. The return on the investment of the funds is credited to the account. ...

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2. Introduction to Individual Accounts

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pp. 9-28

This book starts out with some basics. The first two sections of this chapter consider different types of defined contribution plans and take a broader perspective than most of the remainder of the book. Although the focus of the book narrows in subsequent chapters, the following types of defined contribution ...

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3. Individual Accounts in Social Security Reform: The Debate

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pp. 29-50

A high-stakes debate is raging among politicians, policy analysts, and concerned citizens over the use of individual accounts for Social Security reform in the United States. Some participants are partisans with strongly held positions that are rooted in fundamental differences in political philosophy. ...

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4. Agency Risk and the Management of Individual Account Investments by Corporations and Mutual Funds

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pp. 51-76

The three-year decline in world stock markets starting in 2000 and the dramatic plunge of technology stock prices made clear that individual account participants face substantial financial market risk. However, participants are also vulnerable to improper management of their investments, ...

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5. Individual Management Risk

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pp. 77-100

In individual accounts, workers are usually responsible for investment decisions. Since they bear the risk associated with their accounts, there is logic to the responsibility being assigned to them. Many workers, however, are uninformed about capital markets and investment theory and lack the interest to learn about these topics. ...

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6. Labor Market Issues

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pp. 101-110

It is often argued that, while defined benefit pension plans distort the labor market decisions of workers, reducing their hours of work, individual accounts are nondistortionary and thus would result in greater work by participants (World Bank 1994). Voluntary individual accounts can be designed ...

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7. Benefits and Taxes

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pp. 111-136

Individual accounts accrue in the form of an account balance, but retirees need to receive a steady flow of income to finance their consumption over a number of years. Thus, a decision must be made as to how the account will be converted to an income stream for the retiree—the form in which benefits will be paid. ...

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8. Summary and Conclusions

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pp. 137-150

Individual accounts as part of social security are being debated in the United States and have been adopted in a number of countries. They can be structured so that they are simple. However, actual individual accounts are generally complex in their design and effects, a fact that is often not appreciated, ...

Appendix A. Dealing with Financial Market Risk: Guarantees in Individual Accounts

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pp. 151-164

Appendix B. Labor Market Distortions Due to Contribution Evasion and Avoidance

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pp. 165-166

References

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pp. 167-180

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About the Author

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pp. 181-182

John Turner is a senior policy advisor at the AARP Public Policy Institute in Washington, D.C. Previously, he worked at the International Labor Office in Geneva, Switzerland, where he coedited the book Social Security Pensions: Development and Reform. He has also worked in research offices ...

Index

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pp. 183-194

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About the Institute

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pp. 195-

The W.E. Upjohn Institute for Employment Research is a nonprofit research organization devoted to finding and promoting solutions to employment-related problems at the national, state, and local levels. It is an activity of the W.E. Upjohn Unemployment Trustee Corporation, which was established in 1932 ...


E-ISBN-13: 9780880994514
E-ISBN-10: 0880994517
Print-ISBN-13: 9780880992824
Print-ISBN-10: 0880992824

Page Count: 195
Publication Year: 2006

Edition: First

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Subject Headings

  • Collective bargaining -- United States.
  • Labor unions -- United States.
  • Job security -- United States.
  • Employee rights -- United States.
  • Industrial relations -- United States.
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