Many firms give post-retirement increases in pension benefits to retirees even though the pension contract does not require such increases. A leading explanation of this behavior is that benefit increases are part of an implicit contract where retirees accept lower initial benefits in return for the...

Ausführliche Beschreibung

Bibliographische Detailangaben

Hauptverfasser:	Allen, Steven G. 1952- (VerfasserIn), Clark, Robert L. A. (VerfasserIn), McDermed, Ann Archibald 1941- (VerfasserIn)
Format:	Buch
Sprache:	English
Veröffentlicht:	Cambridge, MA 1993
Schriftenreihe:	National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series 4413
Schlagworte:	Pensions > Cost-of-living adjustments > United States USA
Zusammenfassung:	Many firms give post-retirement increases in pension benefits to retirees even though the pension contract does not require such increases. A leading explanation of this behavior is that benefit increases are part of an implicit contract where retirees accept lower initial benefits in return for the option of receiving a share of the plan's financial returns above the risk-free rate. The paper reports mixed evidence on the linkage between the financial performance of pension plans and post-retirement increases. Between 1980 and 1985, benefit increases were larger in plans with high funding ratios and lofty rates of return. However, the practice of giving post-retirement increases became much less widespread in the 1980s, despite dramatically improved financial performances across all pension plans.
Beschreibung:	35 S.