Tag: defined contribution
The brief’s key findings are: In recent years, several states have shifted from defined benefit (DB) to defined contribution (DC) pension plans. Many of the new plans are “hybrids” with a slimmed down DB plan and a minimal DC plan, which shifts substantial risk to employees. A better hybrid design could offer a full DB…
Abstract We use a general equilibrium life-cycle model with incomplete markets and heterogeneous agents to evaluate the macroeconomic and welfare implications of Defined Benefit (DB) versus Defined Contribution (DC) systems, and to investigate the effects of incremental reform within a particular system. Extensive calibrations illustrate the trade-off between effciency and redistribution that a tax-financed, DB…
