English, Article edition: Conditional Indexation in Defined Benefit Pension Plans in the Netherlands* Jacob A Bikker; Peter J G Vlaar

User activity

Share to:
 
Bookmark: http://trove.nla.gov.au/version/78810
Physical Description
  • article
Language
  • English

Edition details

Title
  • Conditional Indexation in Defined Benefit Pension Plans in the Netherlands&​ast;
Author
  • Jacob A Bikker
  • Peter J G Vlaar
Physical Description
  • article
Notes
  • In an ageing society, defined benefit (DB) pension plans are increasingly difficult to manage by means of contribution policy only, as the contribution base is likely to shrink relative to total pension provisions. This development, together with an increased emphasis on market valuation in regulatory and accounting rules, has led to a switch of DB plans to defined contribution plans throughout the world. In the Netherlands, a different solution has been sought. The typical pension contract nowadays comprises an average earnings DB pension in which only nominal benefits are guaranteed, but with the intention to provide wage or price indexation. In the new supervisory regime, the guaranteed pension rights, based on market valuation, are subject to risk-based solvency requirements. Provisioning is not required for conditional pension rights, although contributions have to be consistent with the indexation ambition. In this paper, we analyse to what extent indexation is indeed likely, given various indexation and contribution policies. Simulations show that voluntary provisioning for indexation is to be recommended. Fully guaranteed indexation is virtually unaffordable under the new supervisory regime, because the real discount rate is generally both very low and highly volatile. The Geneva Papers (2007) 32, 494–515. doi:10.1057/​palgrave.gpp.2510140
  • RePEc:pal:gpprii:v:32:y:2007:i:4:p:494-515
Language
  • English
Contributed by
OAIster

Get this edition

  • Set up My libraries

    How do I set up "My libraries"?

    In order to set up a list of libraries that you have access to, you must first login or sign up. Then set up a personal list of libraries from your profile page by clicking on your user name at the top right of any screen.

  • All (1)
  • Unknown (1)
None of your libraries hold this item.
None of your libraries hold this item.
None of your libraries hold this item.
None of your libraries hold this item.
None of your libraries hold this item.
None of your libraries hold this item.
None of your libraries hold this item.
None of your libraries hold this item.

User activity


e.g. test cricket, Perth (WA), "Parkes, Henry"

Separate different tags with a comma. To include a comma in your tag, surround the tag with double quotes.

Be the first to add a tag for this edition

Be the first to add this to a list

Comments and reviews

What are comments? Add a comment

No user comments or reviews for this version

Add a comment