Chapter 9 Reforming the German Civil Servant Pension Plan

Maurer, Raimond; Mitchell, Olivia S.; Rogalla, Ralph

doi:10.1093/acprof:oso/9780199573349.003.0009

Cited by 4 publications

(7 citation statements)

References 27 publications

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“…Nevertheless, there are several opportunities for extensions: 15 For a detailed discussion see, Artzner et al (1999). 16 Results are based on an ALM-study of a large (German) public DB pension plan; see Maurer et al 2009. Here, pension costs are defined as the stochastic present value of regular and supplementary (additional required in an underfunding situation) into the pension plan by the plan sponsors using a 50-year horizon).…”

Section: Discussionmentioning

confidence: 99%

“…By contrast, many economists argue that the relevant number for discounting future pension payments is the riskless rate of interest rate reflecting the financing cost of the plan sponsor to build up a replicating portfolio. See Blake (2006, p. 77) and Maurer et al (2009). 8 See Pitacco et al (2009), Cairns et al (2006a), as well as Cairns et al (2010).…”

Section: Assumptions In the Pims Modelmentioning

confidence: 99%

“…) andMaurer et al (2009). 8 SeePitacco et al (2009), Cairns et al (2006a, as well asCairns et al (2010).…”

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confidence: 99%

“…11For possible ways to model real-estate investments see Fischer et al (1994), Hoesli and McGregor (2000), Hoevenaars et al (2008), and Maurer et al (2009). …”

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confidence: 99%

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Integrated risk management for defined benefit pensions: models and metrics

Maurer

2014

Journal of Pension Economics and Finance

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The Pension Benefit Guaranty Corporation (PBGC) insures private sector defined benefit (DB) pension plans, when an employer becomes insolvent and is unable to pay the pension liabilities. In principle, the insurance premiums collected by PBGC should be sufficient to cover potential losses; this would ensure that PBGC could pay the insured benefits of terminated pension plan without additional external funding (e.g., from taxpayers). Therefore, the risk exposure of the PBGC from insuring DB pension plans arises from the probability of the employer insolvencies; and the terminating plans' funding status (the excess of the value of the insured plan liabilities over the plan assets). Here we explore only the second component, namely the impact of plan underfunding for the operation of the PBGC. When a DB plan is fully funded, the PBGC's risk exposure for an ongoing plan is low even if the plan sponsor becomes insolvent. Thus the questions most pertinent to the PBGC are: what key risk factors can produce underfunding in a DB plan, and how can these risk factors be quantified? We discuss the key risk factors that produce DB pension underfunding, namely, investment risk and liability risk. These are interrelated and must be considered simultaneously in order to quantify the risk exposure of a DB pension plan. We propose that an integrated risk management model (an Integrated Asset/Liability Model) can help better understand DB pension plan funding risk. We also examine the Pension Insurance Modeling System developed by the PBGC in terms of its own use of some of the building blocks of an integrated risk management model. JEL CODES: G11, G15, G2

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Section: Discussionmentioning

confidence: 99%

Section: Assumptions In the Pims Modelmentioning

confidence: 99%

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Integrated risk management for defined benefit pensions: models and metrics

Maurer

2014

Journal of Pension Economics and Finance

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“… 4. Civil servants enjoy a tax-financed pension with a maximum replacement rate of 72 percent (until 2003: 75%) after 40 years of employment ( Maurer et al, 2009 ). By contrast, public sector employees are insured with the normal contribution-based statutory pension insurance providing lower benefits.…”

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confidence: 99%

From welfare states to welfare sectors: Explaining sectoral differences in occupational pensions with economic and political power of employees

Wiß

2015

Journal of European Social Policy

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Studies analysing welfare have previously focused on countries as units. In the course of pension cuts and the increasing importance of occupational welfare, our traditional understanding of a homogeneous welfare state is being challenged. In this article, I distinguish between both economic individual power (employee skills) and political collective power (trade unions), and their relation with different occupational pensions. A combined analysis by both factors is not common, where employee skills and power resources are traditionally treated as separate, rival explanations of public welfare. Combining the ‘method of difference’ with the ‘method of agreement’, the article first presents the within-country variety of occupational pensions in Germany, Italy, the United Kingdom and Denmark. Occupational pensions in the same economic sectors across countries are then used as the units of analysis in order to illustrate the plausible determinants of economic individual power and political collective power.

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