Design and Implementation Issues in Swedish Individual Pension Accounts

Weaver, Kent

doi:10.2139/ssrn.1148967

Cited by 9 publications

(7 citation statements)

References 1 publication

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“…2,76 mln savers were transferred there because they have withdrawn from making any choice and 174 thousand due to inaction when their preferred fund was terminated. Weaver (2004) reported results of polls which tried to find out the rationale behind this kind of adverse behavior when the system took off. The most popular answers in 2004 were as follows.…”

Section: The Choice Architecture Of Swedish Premium Pension System and Its Resultsmentioning

confidence: 99%

Choice overload paradox and public policy design. The case of Swedish pension system

Czech¹

2016

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In this paper we focus on an adverse effect of extensive choice widely known as ‘choice overload’. We draw on the case of Swedish funded pensions for illustration and analyze the consequences of the design that allowed for maximizing the choice set. The analysis shows limitations of employing the rational choice approach to the real choice decisions biased with common psychological factors and demonstrates that government’s responsibility for the privatized pension system does not end with the design. We also emphasize the need for a decent default option, which would mitigate socially harmful results of adverse behavior effects like procrastination, status quo bias or abstaining from choice. After all, privatized pension systems still belong to the sphere of public policy.

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Section: The Choice Architecture Of Swedish Premium Pension System and Its Resultsmentioning

confidence: 99%

Choice overload paradox and public policy design. The case of Swedish pension system

Czech¹

2016

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“…These accounts are funded by contributions of 2.5% of earnings up to an earnings limit. Workers have a very wide choice of funds—465 choices in the initial round, growing to around 800 in recent rounds (Weaver ). Workers can invest in up to five funds, and the level of their pension benefit is determined in part by the performance of these pension investments.…”

Section: Falling Compliance In the Swedish Individual Account Pensionmentioning

confidence: 99%

Compliance Regimes and Barriers to Behavioral Change

2013

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Existing research on compliance failures by individuals and businesses focuses primarily on information and incentive problems. This article develops a comprehensive framework for analyzing barriers to compliance, giving particular attention to resource and autonomy barriers, heterogeneity of the target population, multiple barriers to compliance, and problems that arise when a complex and ongoing set of actions is require to be "in compliance." How governments react to compliance failures is heavily influenced by the social construction and political power of target populations. The propositions developed in the article are tested against the cases of the Swedish individual account pension system and welfare reform in the United States.Many policies can only achieve their objectives if a broad array of ordinary citizens, corporations, or other actors "comply" with those policies, that is, behave in ways that are consistent with the enunciated objectives of the policy. Financing government requires that citizens and corporations pay their taxes. Lowering the emission of greenhouse gases may require increased use of public transit, the purchase of more fuel-efficient vehicles, and a variety other actions by millions of people. Indeed, for some programs, like bans on smoking in public places, changing the behavior of some target group of citizens is the whole point of the policy. Other policies-fair labor standards, pollution laws, and of course tax lawsrequire compliant behavior from businesses (see, e.g., Gray and Shadbegian 2005;Gunningham and Kagan 2005;Mendeloff and Gray 2005).There are substantial and diverse literatures on why individuals and businesses do or do not comply with public policies. These literatures span the fields of political science, economics, law, and psychology (see, e.g.,

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“…Hacker contrasts these three creeping ways of reforming institutions against the abrupt elimination , where the old system is abolished and new ones created. A vast number of industrial countries have reformed their pension systems through gradual changes, be they layering, drift or conversion, rather than discarding the old systems (Weaver 1998, 2003, 2004).…”

Section: Introductionmentioning

confidence: 99%

Three Routes to Pension Reform: Politics and Institutions in Reforming Pensions in Denmark, Finland and Sweden

Kangas

Lundberg

Ploug

2010

Social Policy &Amp; Administration

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By analysing pension reforms in three Nordic countries -Denmark, Finland and Sweden -that apply different institutional solutions in their old-age security programmes, this article argues that the political processes that shaped the country-specific pension set-ups in the 1950s and 1960s had important ramifications for subsequent reform possibilities. A high degree of inertia exists not only in the institutions themselves but also in the political reform options and the ways in which pensions were reformed. The analysis shows that the 'new politics' was not new in any of the three countries. Furthermore, given the differences in the three cases, the analysis questions the nature of pension reform. The Swedish reform in the late 1990s was a 'big bang' that eliminated the old and changed everything; the Finns built on piecemeal reforms of conversion that gradually changed the whole system; and, while the Danish story appears to be one of stability and status quo, the drift of Danish policy ultimately changed the basic characteristics of the system. Although all three countries have more or less thoroughly reformed their pensions, the reform processes have differed according to both historical legacies and institutional frameworks.

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Design and Implementation Issues in Swedish Individual Pension Accounts

Cited by 9 publications

References 1 publication

Choice overload paradox and public policy design. The case of Swedish pension system

Choice overload paradox and public policy design. The case of Swedish pension system

Compliance Regimes and Barriers to Behavioral Change

Three Routes to Pension Reform: Politics and Institutions in Reforming Pensions in Denmark, Finland and Sweden

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