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The brief’s key findings are: What rate to use to discount public pension liabilities is a hot topic. The Government Accounting Standards Board recommends the estimated return on pension assets – about 8 percent. Economists generally argue for a riskless rate – about 5 percent. Reducing the discount rate would raise the unfunded liability by…
Abstract A long and still growing strand of the retirement literature examines the role financial incentives play in the timing of the retirement decision. A more recent second strand of work has focused on the role of health shocks in the retirement decision. This paper combines these two components of the literature in order to…