Compensating wage differentials for defined benefit and defined contribution occupational pension scheme benefits

Inkmann, Joachim (2006) Compensating wage differentials for defined benefit and defined contribution occupational pension scheme benefits. Discussion paper: UBS Pensions Series 042 (564). Financial Markets Group, London School of Economics and Political Science, London, UK.

Preview

PDF Download (328kB) | Preview

Abstract

The theory of equalizing differences suggests that employer provided pension benefits should be compensated by reduced wage benefits for an employee’s given produc-tivity potential. This paper presents an empirical analysis of compensating wage differentials for occupational pension scheme benefits in the UK using the newly available English Longi-tudinal Study of Ageing. The data allows us to differentiate between Defined Benefit (DB) and Defined Contribution (DC) schemes and to consider different measures of pension bene-fits based on current contributions and changes in accrued pension benefit rights. In our pre-ferred specifications we find evidence for perfect compensating wage differentials for both occupational DB and DC pension scheme benefits.

Item Type:	Monograph (Discussion Paper)
Official URL:	http://fmg.lse.ac.uk
Additional Information:	© 2006 The Author
Divisions:	Financial Markets Group
Subjects:	H Social Sciences > HG Finance H Social Sciences > HB Economic Theory
JEL classification:	J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J33 - Compensation Packages; Payment Methods J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J32 - Nonwage Labor Costs and Benefits; Private Pensions G - Financial Economics > G2 - Financial Institutions and Services > G23 - Pension Funds; Other Private Financial Institutions
Sets:	Research centres and groups > Financial Markets Group (FMG) Collections > Economists Online Collections > LSE Financial Markets Group (FMG) Working Papers
Date Deposited:	22 Jul 2009 08:23
Last Modified:	19 Jan 2020 00:47
URI:	http://eprints.lse.ac.uk/id/eprint/24516

Actions (login required)

View Item