Sample chapter for the economic theory of annuities_8

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Index adverse selection, xiii, 4; bequests and, 82; bundling and, 131; defined, 67; empirical importance of, 67; general model for, 69–71; proof of, 76; rate of return and, 71; refundable annuities and, 144–49; risk class and, 67–76 after-tax retirement annuities (ATRA), 81n25 age, 6; coefficient of relative risk aversion and, 29; consumption and, 12–14; life expectancy and, 15, 18; longevity and, 4–5; no-arbitrage condition and, 24–25; normal retirement age (NRA) and, 37–38; optimum retirement, 12–14, 21–22, 27–28, 32–40; partial annuitization and, 33–34; payout schemes and, 3; present/future self utility and, 48–50; profile mismatch and, 2–3; risk class and, 56–66; steady-state age density distributions and, 97–108; survival functions and, 15–18; survival probabilities and, 1–2, 45–50; timing of purchases and, 135–37 age composition effect, 97 aggregate resource constraint, 21–22, 32 Angeletos, G., 45 annua, 9 annuities: bundling and, 131–34; competitive equilibrium and, 23–24, 51–53, 59, 61, 65, 78–79, 135–37; deferred, 26; defined, 1; differentiated, 81–96; equivalent level of assets and, 41–42; first best equilibrium and, 6, 21–23, 56–58, 64, 77–78, 141; full annuitization and, 23–24; growth of, 9–10; holding, 1n1; information effects and, 3–4; long-term, 6, 26, 59, 62–66; low returns and, 35; money’s worth of, 10; moral hazard and, 51–55, 79–80; no-arbitrage condition and, 5, 24–25, 60–62, 70–71; optimum taxation of, 125–28; options and, xv, 9; partial annuitization and, 33–35; payout terms and, 59; period-certain, 7, 81, 87–89; pooling equilibrium and, 103–4 (see also pooling equilibrium); predetermined flow of returns and, 63, 147–48; profile mismatch and, 2–3; protected, 81; refundable, 8, 136, 144–49; regular, 81, 84, 87–89; revaluation of, 64–65; sequential market equilibrium and, 137–40; short market history of, 9–10; short-term, 6, 26, 33–34, 60–62; stable flows of, 4n3; survival probabilities and, 1–2, 45–50 (see also survival probabilities); timing of purchases and, 135–37; unintended bequests and, 1–2, 98, 104–5; welfare value and, 41–42 annuity puzzle, 2–3 Arrow, Kenneth, xv, 111 asymmetric information, 6, 118–22 Atkinson, A., xiv Austen, Jane, 9 Averting the Old Age Crisis (World Bank), xv Baldwin, B. G., 11 banks, 4 behavioral models, xiv, 3, 45–47, 136–37 Benartzi, S., 136, 148 bequests, 38n15; adverse selection and, 82; ergodic long-term distribution of, 104–5; information effects and, 3–4; insurance and, 81–83; motive for, 1n1; partial annuitization and, 33–34; period-certain annuities and, 87–89; pooling equilibrium and, 82; private information and, 82; renewal process and, 105; separating equilibrium and, 82; steady-state age density distributions and, 104–5; unintended, 1–2, 98, 104–5 Bernheim, D. B., 1n1, 27 Bible, 1 Biggs, J. H., 11 Bodie, Z., 132, 135 bounded rationality, xiv, 3 Bowers, N. L., 11 Brown, J. R., 1–3, 13, 33, 67, 81, 140n49 ... - tailieumienphi.vn