Lopes, Paula and Michaelides, Alexander (2005) Rare events and annuity market participation. Discussion paper: UBS Pensions Series 039, 553. Financial Markets Group, London School of Economics and Political Science, London, UK.
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Abstract
We investigate whether a rare event (like the default of the annuity provider) can explain the annuity market participation puzzle. High risk aversion is needed to change behavior in the presence of such a disastrous shock but higher risk aversion also makes annuities more valuable. Therefore, these rare events are unlikely candidates to explain the low take-up of voluntary annuities.
| Item Type: | Monograph (Discussion Paper) |
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| Official URL: | http://fmg.lse.ac.uk |
| Additional Information: | © 2005 The Authors |
| Uncontrolled Keywords: | Annuity provision, Saving during retirement, Rare events. |
| Library of Congress subject classification: | H Social Sciences > HF Commerce H Social Sciences > HG Finance H Social Sciences > HB Economic Theory |
| Journal of Economic Literature Classification System: | H - Public Economics > H0 - General > H00 - General E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Employment, and Investment > E21 - Macroeconomics: Consumption; Saving; Aggregate Physical and Financial Consumer Wealth |
| Sets: | Research centres and groups > Financial Markets Group (FMG) Collections > Economists Online |
| Rights: | http://www.lse.ac.uk/library/rights/LSERO.htm |
| Identification Number: | 553 |
| URL: | http://eprints.lse.ac.uk/24672/ |
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